TAXES - GASOLINE;

OLR Research Report


April 8, 2003

 

2003-R-0349

AVIATION FUEL TAXES

By: Judith Lohman, Chief Analyst

You asked what other states’ aviation fuel tax rates are. You were especially interested in tax rates in northeastern states.

At least 17 states tax aviation fuel, according to a computer search of the Commerce Clearinghouse (CCH) state tax database. Rates range from a low of 3 cents per gallon in Nebraska to a high of 20 cents per gallon in Texas.

Of eight Northeastern states, four (Maine, Massachusetts, New York, and New Jersey) impose taxes ranging from 3. 4 cents to 14 cents per gallon on various types of aviation fuel. Connecticut, New Hampshire, Rhode Island, and Vermont impose no taxes on aviation fuels.

Table 1 shows aviation fuel tax rates in 17 states, along with major exemptions and refund provisions.

TABLE 1: STATE AVIATION FUEL TAX RATES

State

Rate (Cents/Gal)

Major Exemptions

Refunds

Alaska

    Aviation gasoline: 4. 7

    Aviation fuel other than gasoline: 3. 2

   

Arizona

5. 0

 

Aircraft applying seed, fertilizer, or pesticides

Florida

6. 9

Aviation fuel is exempt from county fuel taxes.

    Carriers offering transcontinental jet service and meeting certain Florida workforce qualifications

    Carriers in the business of transporting people or property for compensation

Idaho

Jet fuel: 4. 5

All other aviation fuel: 5. 5

Fuel sold to Idaho National Guard

 

Maine

Jet or turbojet fuel: 3. 4

   

Maryland

7. 0

Scheduled air carriers,

the state and its localities, federal agencies, and foreign governments

    Fuel dispensed to an aircraft company located in Maryland

    Aircraft used at least 70% of time for agriculture

Massachusetts

State tax -7. 5% of average price per gallon – minimum 10. 0 cents/ gallon (current tax is 11. 0)

Local tax – Towns may levy excise tax on aviation fuel used in turbine propeller jets, turbojet and jet-driven aircraft, and jet engines. Tax is 5% of average price per gallon – minimum 5. 0 cents/gallons

If local tax is paid, fuel is exempt from state tax.

Currently, the following towns levy local tax: Barnstable, Bedford, Boston, Concord, Lexington, Lincoln, North Andover, Norwood, and Worcester.

    Federal government

    In foreign or interstate commerce

    Foreign embassies

    By one licensed distributor to another or to a person duly licensed in another state (under certain restrictions)

Missouri

9. 0

 

Commercial agricultural aircraft

Montana

4. 0

 

    Portion of tax paid on fuel used for agricultural purposes

    50% refund to federally certified scheduled passenger air carrier

Nebraska

    Aviation gasoline: 5. 0

    Aviation jet fuel: 3. 0

 

Approved air schools

New Jersey

4. 0

Common carriers in interstate and foreign commerce

 

New York

    Aviation gasoline: 14. 0

    Retail sellers of aviation gasoline: 5. 6

    Kero-jet fuel: 5. 6

   

North Dakota

8. 0

   

Texas

20. 0

Common or contract carriers

 

Utah

9. 0 (4. 0 for federally certificated air carriers purchasing aviation fuel at Salt Lake International Airport)

   

Washington

0. 5% of wholesale value (until 6/1/07)

   

Wisconsin

6. 0

Federal government

Air carrier companies

 
Wyoming

5. 0

 

70% credit for bulk fuel purchased for agriculture

Sources: Commerce Clearinghouse, State Tax Guide; State tax agency websites

JL: eh