Levy of Excise Tax; Rate; Taxation of Motor Fuels Not Commonly Sold or Measured by Gallon; Rate; Prohibition of Tax on Motor Fuel by Political Subdivisions; Exception; Exempted Sales

  1. Law
  2. Georgia Code
  3. Revenue and Taxation
  4. Motor Fuel and Road Taxes
  5. Motor Fuel Tax
  6. Levy of Excise Tax; Rate; Taxation of Motor Fuels Not Commonly Sold or Measured by Gallon; Rate; Prohibition of Tax on Motor Fuel by Political Subdivisions; Exception; Exempted Sales

Checkout our iOS App for a better way to browser and research.

    1. An excise tax is imposed at the rate of 26› per gallon on distributors who sell or use motor fuel, other than diesel fuel, within this state. An excise tax is imposed at the rate of 29› per gallon on distributors who sell or use diesel fuel within this state. It is the intention of the General Assembly that the legal incidence of the tax be imposed upon the distributor.

      (1.1) (A) Beginning on July 1, 2016, and annually thereafter, the amount of this excise tax per gallon on distributors shall be automatically adjusted on an annual basis in accordance with this paragraph.

      1. Using 2014 as a base year, the department shall determine the average miles per gallon of all new vehicles registered in this state pursuant to Code Section 48-5C-1 using the average of combined miles per gallon published in the United States Department of Energy Fuel Economy Guide. Beginning on July 1, 2016, and each year thereafter, the department shall calculate the average miles per gallon of all new vehicles registered in this state in the previous year. The excise tax rate shall be multiplied by the percentage increase or decrease in fuel efficiency from the previous year, and the resulting increase or decrease shall be added to the excise tax rate to determine the preliminary excise tax rate.
      2. Once the preliminary excise tax rate is established, it shall be multiplied by the annual percentage of increase or decrease in the Consumer Price Index. The resulting calculation shall be added to the preliminary excise tax rate, and the result of such calculation shall be the new excise tax rate for motor fuels for the next calendar year. The Consumer Price Index shall no longer be used after July 1, 2025.
    2. In the event any motor fuels which are not commonly sold or measured by the gallon are used in any motor vehicles on the public highways of this state, the commissioner may assess, levy, and collect a tax upon such fuels, under such regulations as the commissioner may promulgate, in accordance with and measured by the nearest power potential equivalent to that of one gallon of regular grade gasoline. Any determination by the commissioner of the power potential equivalent of such motor fuels shall be prima-facie correct. Upon each such quantity of such fuels used upon the public highways of this state, a tax at the same rate per gallon imposed on motor fuel under paragraph (1) of this subsection shall be assessed and collected.
    3. No county, municipality, or other political subdivision of this state shall levy any fee, license, or other excise tax on a gallonage basis upon the sale, purchase, storage, receipt, distribution, use, consumption, or other disposition of motor fuel. Nothing contained in this article shall be construed to prevent a county, municipality, or other political subdivision of this state from levying license fees or taxes upon any business selling motor fuel.
      1. For purposes of this subsection, and notwithstanding the provisions of paragraph (2) of this subsection and any provision contained in the National Bureau of Standards Handbook or any other national standard that may be adopted by law or regulation, the gallon equivalent of compressed natural gas shall be not less than 110,000 British thermal units and the gallon equivalent of liquefied natural gas shall not be less than 6.06 pounds.
      2. As used in this paragraph, the term:
        1. "Compressed natural gas" means a mixture of hydrocarbon gases and vapors, consisting principally of methane in gaseous form, that has been compressed for use as a motor fuel.
        2. "Liquefied natural gas" means methane or natural gas in the form of a cryogenic or refrigerated liquid for use as a motor fuel.
  2. No tax is imposed by this article upon or with respect to the following sales by duly licensed distributors:
    1. Bulk sales to a duly licensed distributor;
    2. Sales of motor fuel for export from this state when exempted by any provisions of the Constitutions of the United States or this state;
    3. Sales of motor fuel to a licensed distributor for export from this state;
    4. Sales of motor fuel to the United States for the exclusive use of the United States when the motor fuel is purchased and paid for by the United States;
    5. Sales of aviation gasoline to a duly licensed aviation gasoline dealer, except for 1› per gallon of the tax imposed by paragraph (1) of subsection (a) of this Code section;
    6. Bulk sales of compressed petroleum gas or special fuel to a duly licensed consumer distributor;
      1. Sales of compressed petroleum gas or special fuel to a consumer who has no highway use of the fuel at the time of the sale and does not resell the fuel. Consumers of compressed petroleum gas or special fuel who have both highway and nonhighway use of the fuel and resellers of such fuel must be licensed as distributors in order for sales of the fuel to be tax exempt. Each type of motor fuel is to be considered separately under this exemption.
        1. In instances where a sale of compressed petroleum gas has been made to an ultimate consumer who has both highway and nonhighway use of that type of motor fuel and no tax has been paid by the distributor on the sale, the consumer shall become licensed as a consumer distributor of that type of motor fuel. After the consumer is licensed as a consumer distributor and if it is demonstrated to the satisfaction of the commissioner that the motor fuel purchased prior to the licensee's becoming licensed as a consumer distributor was used for nonhighway purposes, such sales shall be exempt from the tax imposed by this article; provided, however, that, if at the time of demonstration the ultimate consumer does not have both highway and nonhighway use of such fuel but it can be demonstrated by the distributor to the satisfaction of the commissioner that the motor fuel was used for nonhighway purposes, the sales shall be exempt from the tax imposed by this article; and
        2. (I) Any special fuel sold by a distributor to a purchaser who has a storage receptacle which has a connection to a withdrawal outlet that may be used for highway use, as defined in paragraph (8) of Code Section 48-9-2, is not exempt from the motor fuel and road taxes imposed by this article unless: (1) the purchaser is at the time of sale a valid licensed distributor of that type of motor fuel, or (2) an exemption certificate has been obtained from the purchaser on forms furnished by the Department of Revenue showing that the purchaser has no highway use of such fuels and is not a reseller of such fuels. Each exemption certificate shall be valid for a period of not more than three years and shall be kept by the distributor as one of the records specified in Code Section 48-9-8. It shall be the responsibility of the purchaser to notify the distributor when the purchaser is no longer qualified for the nonhighway exemption. All applicable taxes must be charged the purchaser until the purchaser is granted a valid distributor's license for that type of motor fuel.
      3. Any such purchaser granted an exemption under subdivision (I) of this division who falsely claims the exemption or fails to rescind the purchaser's exemption certificate to the distributor in writing when he or she is no longer eligible for the exemption shall be deemed a distributor for purposes of taxation and is subject to all provisions of this article relating to distributors. This division in no way shall restrict the option of the purchaser to become licensed as a distributor. If the distributor sells special fuel to a purchaser who has a storage receptacle which has a connection to a withdrawal outlet that may be used for highway use, as defined in paragraph (8) of Code Section 48-9-2, and the purchaser is not a valid licensed distributor and has not executed a valid signed exemption certificate, the taxes imposed by this article are due from the distributor and not the purchaser on all sales of that type of fuel to that purchaser;
    8. Sales of fuel oils, compressed petroleum gas, or special fuel directly to an ultimate consumer to be used for heating purposes only. The delivery of fuel oils, compressed petroleum gas, or special fuel directly to an ultimate consumer to be used for heating purposes only shall be made directly into the storage receptacle of the heating unit of the consumer by the licensed distributor. To qualify for this exemption, sales must be delivered into storage receptacles that are not equipped with any secondary withdrawal outlets for the motor fuel;
    9. Sales of dyed fuel oils to a consumer for other than highway use as defined in paragraph (8) of Code Section 48-9-2;
      1. During the period of July 1, 2012, through June 30, 2015, sales of motor fuel, as defined in paragraph (9) of Code Section 48-9-2, for public mass transit vehicles which are owned by public transportation systems which receive or are eligible to receive funds pursuant to 49 U.S.C. Sections 5307 and 5311 for which passenger fares are routinely charged and which vehicles are used exclusively for revenue generating purposes which motor fuel sales occur at bulk purchase facilities approved by the department.
      2. During the period of July 1, 2012, through June 30, 2015, sales of motor fuel, as defined in paragraph (9) of Code Section 48-9-2, for vehicles operated by a public campus transportation system, provided that such system has a policy which provides for free transfer of passengers from the public transportation system operated by the jurisdiction in which the campus is located; makes the general public aware of such free transfer policy; and receives no state or federal funding to assist in the operation of such public campus transportation system and which motor fuel sales occur at bulk purchase facilities approved by the department.
      3. For purposes of this paragraph, the term "vehicle" or "vehicles" means buses, vans, minibuses, or other vehicles which have the capacity to transport seven or more passengers; or
    11. For the period of time beginning July 1, 2013, and ending June 30, 2015, sales of motor fuel to public school systems in this state for the exclusive use of the school system in operating school buses when the motor fuel is purchased and paid for by the school system.
  3. Fuel oils, compressed petroleum gas, or special fuel used by a duly licensed distributor for nonhighway purposes is exempt from the tax imposed by this article.
  4. No export from this state shall be recognized as being exempt from tax under paragraphs (2) and (3) of subsection (b) of this Code section unless the exporter informs the seller and the terminal operator of the intention to export and causes to be set out the minimum information specified in subsection (e) of Code Section 48-9-17 on the bill of lading or equivalent documentation under which the motor fuel is transported. In the event that the motor fuel is delivered to any point other than that which is set out on the bill of lading or equivalent documentation, the legal incidence of the tax shall continue to be imposed exclusively upon the exporter who caused the export documentation to be issued and no exemption shall be recognized until suitable proof of exportation has been provided to the commissioner.

(Code 1933, § 92-1403, enacted by Ga. L. 1978, p. 186, § 1; Code 1933, § 91A-5003, enacted by Ga. L. 1978, p. 309, § 2; Ga. L. 1979, p. 5, § 102; Ga. L. 1979, p. 1274, §§ 1, 3; Ga. L. 1980, p. 10, § 30; Ga. L. 1985, p. 1644, § 1; Ga. L. 1986, p. 10, § 48; Ga. L. 1993, p. 811, § 2; Ga. L. 1993, p. 1502, § 4; Ga. L. 1994, p. 569, § 1; Ga. L. 1995, p. 10, § 48; Ga. L. 1995, p. 359, § 2; Ga. L. 2004, p. 425, § 2; Ga. L. 2005, p. 60, § 48/HB 95; Ga. L. 2005, p. 505, § 1/HB 384; Ga. L. 2006, p. 523, § 1/HB 1244; Ga. L. 2008, p. 889, § 2/HB 1035; Ga. L. 2010, p. 813, § 2/HB 1393; Ga. L. 2012, p. 1348, § 1/HB 743; Ga. L. 2013, p. 786, § 1/HB 211; Ga. L. 2013, p. 869, § 1/HB 371; Ga. L. 2015, p. 236, § 5-13/HB 170; Ga. L. 2018, p. 152, § 3/HB 150; Ga. L. 2020, p. 371, § 8/HB 1098; Ga. L. 2020, p. 685, § 6/HB 511.)

The 2015 amendment, effective July 1, 2015, in paragraph (a)(1), in the first sentence, substituted "26 per gallon" for "7 1/2 per gallon" and inserted ", other than diesel fuel,", and added the second sentence; added paragraph (a)(1.1); and deleted "and all of the tax imposed by Code Section 48-9-14" following "Code section" at the end of paragraph (b)(5). See Editor's notes for applicability.

The 2018 amendment, effective July 1, 2018, substituted "2022" for "2018" at the end of the last sentence in subparagraph (a)(1.1)(C).

The 2020 amendments. The first 2020 amendment, effective July 29, 2020, substituted "July 1, 2025" for "July 1, 2022" at the end of the last sentence of subparagraph (a)(1.1)(C). The second 2020 amendment, effective January 1, 2021, made identical changes.

Code Commission notes.

- Pursuant to Code Section 28-9-5, in 1985, "is exempt" was substituted for "are exempt" in subsection (c).

Pursuant to Code Section 28-9-5, in 1986, a hyphen was inserted in "prima facie" in the second sentence of paragraph (a)(2) and "ultimate" was substituted for "utlimate" in the second sentence of division (b)(7)(B)(i).

Editor's notes.

- Ga. L. 2015, p. 236, § 9-1(b)/HB 170, not codified by the General Assembly, provides that: "Tax, penalty, and interest liabilities and refund eligibility for prior taxable years shall not be affected by the passage of this Act and shall continue to be governed by the provisions of Title 48 of the Official Code of Georgia Annotated as it existed immediately prior to the effective date of this Act." This Act became effective July 1, 2015.

Ga. L. 2015, p. 236, § 8-1/HB 170, not codified by the General Assembly, provides that: "This Act shall be known and may be cited as the 'Transportation Funding Act of 2015.' "

Ga. L. 2015, p. 236, § 8-2/HB 170, not codified by the General Assembly, provides that: "It is the intention of the General Assembly, subject to appropriations and other constitutional obligations of this state, that year to year revenue increases be prioritized to fund education, transportation, and health care in this state."

Law reviews.

- For article, "Revenue and Taxation: Amend Titles 48, 2, 28, 33, 36, 46, and 50 of the Official Code of Georgia Annotated, Relating Respectively to Revenue and Taxation, Agriculture, the General Assembly, Insurance, Local Government, Public Utilities, and State Government," see 28 Georgia St. U.L. Rev. 217 (2011). For article on the 2015 amendment of this Code section, see 32 Georgia St. U.L. Rev. 261 (2015).

JUDICIAL DECISIONS

Section is constitutional. Road Bldrs., Inc. v. Hawes, 228 Ga. 608, 187 S.E.2d 287 (1972).

Classification for taxation of distributors of motor fuels is not arbitrary, unreasonable, or unnatural because the classification seeks to place in the same class and tax under one head distributors of motor fuel engaged in business as an occupation and for profit, and a political subdivision of the state not engaged in business, which uses such fuels for a purely governmental purpose. Wright v. Fulton County, 169 Ga. 354, 150 S.E. 262 (1929).

Intent and purpose.

- It is manifest from the terms of this section that the General Assembly did not intend to impose motor fuel tax on fuels if those fuels were neither sold for use nor used in the propulsion of motor vehicles on the public highways. The scheme of former Code 1933, Ch. 92-14 afforded to the distributor, the dealer, and the ultimate consumer the means of ascertaining the taxability or nontaxability of such motor fuels, the means of reporting the sales and paying the tax, or claiming the exemption, and when the exemption is drawn in question, of proving the exemption. Undercofler v. Standard Oil Co., 111 Ga. App. 592, 142 S.E.2d 298 (1965).

Local sales and use taxes separate and distinct and not motor fuel taxes.

- Trial court did not err in dismissing the plaintiffs' complaint that local sales and use taxes on motor fuels were not allocated to the maintenance and construction of public roads and bridges as the Motor Fuel Provision revealed that motor fuel taxes were limited to per-gallon taxes on distributors of motor fuel, and did not include sales and use taxes imposed on retail sales of motor fuels because the local sales and use taxes authorized by Ga. L. 2015, pp. 236, 241-264, §§ 5-8 (HB 170) were separate and distinct from the taxes on distributors and were not "motor fuel taxes" as that term was used in the Motor Fuel Provision; and, as a result, the defendants had no duty to appropriate for public roads an amount of revenue equal to the proceeds from local sales and use taxes. Ga. Motor Trucking Ass'n v. Georgia Dep't of Revenue, 301 Ga. 354, 801 S.E.2d 9 (2017).

Consumer may personally acquire a distributor's license.

- This serves to release the dealer from responsibility for the payment of motor fuel taxes while at the same time assuring the consumer that the consumer need pay taxes only on that portion of fuel relegated to highway uses. Scott v. Blackmon, 132 Ga. App. 578, 208 S.E.2d 589 (1974).

Tax assessments are made when one has the potential for highway use, that is, whether one owns or operates a vehicle capable of highway use at the time of the sale. Scott v. Blackmon, 132 Ga. App. 578, 208 S.E.2d 589 (1974).

Tax not part of retail sales price for sales and use tax purposes.

- Tax imposed by this section is upon the incident of the sale to the consumer and should not be included as a part of the retail sales price for calculating the sales and use tax. State v. Thoni Oil Magic Benzol Gas Stations, Inc., 121 Ga. App. 454, 174 S.E.2d 224, aff'd, 226 Ga. 883, 178 S.E.2d 173 (1970).

Municipal tax based on storage capacity violates section.

- Under the provision prohibiting municipalities from the levy of any fee, license, privilege, or excise tax or taxes upon the sale, purchase, storage, receipt, distribution, use, consumption, or other disposition of motor fuel, but not proscribing the levying by municipalities of reasonable license fees or taxes upon the business of selling motor fuel, a license and tax ordinance imposing graduated taxes on gasoline stations having storage capacities within various limits is void, since, although clothed in the language of merely imposing a tax on the gasoline storage capacity of filling stations, its necessary effect was to tax the storage of the fuel itself; and consequently to impose a prohibited additional tax on the commodity itself. Southern Oil Stores, Inc. v. City of Macon, 188 Ga. 544, 4 S.E.2d 243 (1939).

Exemption of instrumentalities of United States government.

- Federal Land Bank and other corporations composing the Farm Credit Administration of Columbia are instrumentalities of the United States government, within the meaning of this section, and by the express terms of this section no tax is levied in respect to sale of gasoline made to them. An action for injunction brought by such corporations against the commissioner states a cause of action, and should not have been dismissed on demurrer (now motion to dismiss). Federal Land Bank v. Forrester, 192 Ga. 446, 15 S.E.2d 517 (1941).

OPINIONS OF THE ATTORNEY GENERAL

American National Red Cross was not liable for the second motor fuel tax on its purchases of motor fuel because it was a federal instrumentality for purposes of immunity from state taxation; and former Code 1933, § 92-1420 imposing the tax adopted the exemption of the original Motor Fuel Tax Act under former Code 1933, § 92-1403 for sales of motor fuel to the United States. 1980 Op. Att'y Gen. No. 80-28.

So-called "economy" gasolines are taxed in the same manner as other grades of gasoline and the fact that those gasolines are sold at a lower rate to the consumer would not affect the eligibility for refund of the tax when other refund conditions are met. 1962 Op. Att'y Gen. p. 518.

No exemption for motor fuel purchased with funds appropriated by the federal government for use of the Georgia National Guard since the fuel is not paid for by the United States. 1963-65 Op. Att'y Gen. p. 92.

Municipalities are not exempt from the tax on motor fuel. 1950-51 Op. Att'y Gen. p. 188.

Municipal corporation is not exempt from payment of the motor fuel tax. 1945-47 Op. Att'y Gen. p. 583.

Proof by aviation gasoline distributors of refund claims.

- Refunds may be made to the distributor when satisfactory proof submitted by the distributor that aviation gasoline for which refund is claimed was sold to the ultimate consumer. Such refunds may be refused when the accounting records of the distributor are not maintained in such manner as will readily permit verification of claims for refund by the commissioner's field auditors. 1962 Op. Att'y Gen. p. 492.

RESEARCH REFERENCES

Am. Jur. 2d.

- 71 Am. Jur. 2d, State and Local Taxation, §§ 95 et seq., 142 et seq., 504 et seq.

C.J.S.

- 53 C.J.S., Licenses, §§ 5, 56, 57.

ALR.

- Municipal tax imposed upon or measured by sales of gasoline of one conducting business within city limits as payable in respect of sales or deliveries beyond city limits, 106 A.L.R. 1332.

Validity of privilege tax as applied to contractor performing contract with federal government, 114 A.L.R. 347.

Tax exemptions and the contract clause, 173 A.L.R. 15.

Legislative power to exempt from taxation property, purposes, or uses additional to those specified in Constitution, 61 A.L.R.2d 1031.

What constitutes a sale "at retail" within federal retailers' excise tax statute (26 USC (IRC 1954) chap 31), 93 A.L.R.2d 1120.


Download our app to see the most-to-date content.