Idaho State Tax Commission

Idaho State Tax Commission

Gaseous Special Fuels

Gaseous special fuels are gases at a standard temperature and pressure. They're taxed:

  • When used in a motor vehicle
  • At the energy equivalent of a gallon of gasoline

The most common forms of gaseous special fuels are propane and natural gas.

Propane

Propane is delivered in a compressed state.

Natural Gas

Natural gas is delivered as either:

  • CNG – under pressure as compressed natural gas, or
  • LNG – in a super cold state as liquefied natural gas.

The purpose for changing the state of natural gas is to allow the vehicle to carry more potential energy in a smaller space.

When tax is charged

Consumers commonly use propane and natural gas as heating fuels. Because of this, distributors include the motor fuels tax when they deliver fuel:

  • Into the main supply tank of a vehicle requiring licensing
  • Into a bulk tank that's mainly used by vehicle(s) requiring licensing

When the licensed distributor doesn't include the tax in the price of the gaseous special fuels, the customer must file and pay motor fuels tax. Use Form 75, Idaho Fuel Use Report.

If the tax is charged but the gaseous fuel is used in a nontaxable way, the consumer can file for a refund of the motor fuels tax.

Transfer fee: Gaseous special fuels aren't subject to the transfer fee. They're not liquid at standard temperature and pressure.

Collecting the tax

Gaseous fuels sellers must be licensed distributors. They can get a:

  • Motor fuels distributor license – allows them to buy for resale any type of untaxed motor fuels
  • Gaseous fuels distributor license – allows them to buy for resale gaseous special fuels

Page last updated July 20, 2018. Last full review of page: July 20, 2018.

This information is for general guidance only. Tax laws are complex and change regularly. We can't cover every circumstance in our guides. This guidance may not apply to your situation. Please contact us with any questions. We work to provide current and accurate information. But some information could have technical inaccuracies or typographical errors. If there's a conflict between current tax law and this information, current tax law will govern.