Consumers usually pay Idaho fuels tax when they buy fuel from a retail dealer in Idaho. There are different types of fuel and tax rates. The price paid usually includes the cost of the fuels tax.
There are four exceptions:
- Dyed diesel. This diesel fuel is meant for off-road use only. It’s dyed red to distinguish it from diesel for road use.
- Gaseous fuels. Tax applies only if the fuel goes directly into the supply tank of a licensed motor vehicle.
- Racing fuels. High-octane, leaded gasoline used in motor vehicles designed for racing isn’t taxed as a motor fuel.
- Buying from an Idaho Indian tribe or member. The fuel that these retailers sell won’t include Idaho fuels tax, but will include a tribal fuel tax.
Fuels tax funds roads, airports, waterway improvements, and more.
When you can get a fuels tax refund
You can claim a refund if you buy fuel with Idaho fuels tax included in the price and use the fuel in a nontaxable way. You must use the fuel and have receipts that show you paid the tax. Bulk purchases require withdrawal records. You must have mileage records if you claim nontaxable miles.
Dyed diesel is never eligible for a refund. Read more about dyed diesel
Sales and use taxes on refunds
Sometimes you need to pay use tax if you receive a fuels tax refund. Use this chart to see when.
| Fuel | Fuels tax included in price? | You owe sales tax on sale? | You owe sales tax on a refund? |
|---|---|---|---|
| Gasoline | Yes | No | Yes* |
| Undyed diesel | Yes | No | Yes* |
| Dyed diesel | No | Yes* | No** |
*Unless another sales or use tax exemption applies.
**Since you didn’t pay fuels tax you can’t apply for a refund and you won’t owe sales tax afterwards.
Read more at You might owe use tax.
Gasoline
“Gasoline” includes ethanol and related blends (E1 to E99).
Gasoline uses eligible for a fuels tax refund
To get a refund, you must buy and use at least 50 gallons of gasoline in a year in any of the following ways:
- Stationary engines (e.g., pumps, generators)
- Unlicensed off-road vehicles or equipment (snowmobiles and motorcycles don’t qualify.)
- Motor vehicles that aren’t required to be licensed
- Motor vehicle auxiliary engines (power take-off equipment doesn’t qualify)
- Commercial motorboats (personal pleasure boats don’t qualify)
- Unregistered all-terrain vehicles (ATVs) as defined in Idaho Code section 67‑7101
Gasoline uses not eligible for a fuels tax refund
Some uses of gasoline that don’t qualify for a fuels tax refund include:
- Motor vehicles that are licensed or required to be licensed
- Motor vehicles exempt from registration due to ownership or residence
- Licensed motor vehicle power take-off equipment
- Recreational vehicles
- Motorcycles, motor scooters, motorized bicycles, registered ATVs and snowmobiles
- Noncommercial motorboats
- Boats a government agency operates
Special fuels
Special fuels include dyed and undyed diesel, biodiesel and biodiesel blends (e.g., B1 to B99).
Special fuels also include propane and natural gas. The fuels tax doesn’t apply on propane and natural gas purchases unless the fuel is put directly into the supply tank of a licensed motor vehicle. Read more about gaseous special fuels .
If you buy propane or natural gas in bulk for vehicles, you can agree to let your seller charge you Idaho fuels tax. See Idaho Code section 63‑2401(7)(b).
You can claim a fuels tax refund only if you paid the fuel tax on the special fuels you bought.
Dyed diesel is never eligible for a refund. Read more about dyed diesel
Tax-paid special fuels eligible for a fuels tax refund
You could get a refund if you buy tax-paid undyed diesel or other tax-paid special fuels and use them in:
- Licensed motor vehicles operated off-road
- Motor vehicles that a government agency owns or leases and operates
- Heating units
- Power take-off equipment, auxiliary engines, stationary engines
- Unlicensed equipment
- Commercial motorboats (personal pleasure boats don’t qualify)
Tax-paid special fuels not eligible for a fuels tax refund
Some uses of tax-paid special fuels that don’t qualify for a fuels tax refund include:
- Licensed motor vehicles operated on Idaho roads open to the public
- Recreational vehicles
- Noncommercial motorboats
- Boats a government agency operates