Texas Motor Fuels Tax

person on pump - fuel

Gas and diesel generally are subject to tax in Texas at rate of $0.20 per gallon when:

  • These fuels are removed from a storage facility, commonly called a terminal rack, other than by bulk transfer. A terminal rack typically serves as a waystation between the refinery and transport to gas stations or wholesale distributors. The supplier or permissive supplier must collect the tax from the person who orders the removal of the fuels from the terminal rack.

  • These fuels are imported for delivery in the state, other than bulk transfer. The supplier or permissive supplier must collect the tax from the person who imports the fuels into the state, unless the seller is not a supplier or permissive supplier, in which case the person who imports the fuels into the state must remit the tax.
  • These fuels are withdrawn from the bulk transfer / terminal system in this state. The supplier must collect the tax from the person who orders the removal from the bulk transfer / terminal system.
  • These fuels are brought into this state in a motor fuel supply truck or tanks of a motor vehicle by a person required to be licensed as an interstate trucker. The interstate trucker must pay the tax.
  • These fuels are blended in this state outside the bulk transfer / terminal system. The blend must pay the tax, with the number of gallons subject to tax being the difference between the number of gallons of blended fuel and the number of previously taxed fuels used to make the blended fuel.
  • These fuels are being exported and are sold to certain persons in the state. The person that sells the fuels must collect the tax.
  • These fuels are being exported and are sold to certain persons in the state and are delivered to a destination in the state. The person that redirected delivery of the gasoline to a destination in the state must pay the tax.

The taxes for gasoline and diesel are added to the selling price of the gasoline and diesel so that the tax is ultimately paid by the consumer of the gasoline or diesel.

On the other hand, compressed natural gas and liquefied natural gas generally are taxed at a rate $0.15 per gallon at the time that the gas is delivered into a fuel supply tank of a motor vehicle. The dealer is liable for the tax and must add the amount of the tax to the selling price of the gas.

If you have any questions, please give us a call.