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Aviation Gas and Fuel
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Petroleum Tax Fact Sheet 600
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Aviation gasoline is any gasoline that is used to produce or generate power for propelling internal combustion engine aircraft.
It includes any gasoline that meets American Society for Testing and Materials (ASTM) specification D910-16, or any ASTM specification as aviation gasoline, and is invoiced and billed by:
- A producer, manufacturer, refiner, or blended to a distributors or dealer
- A distributor to a dealer or consumer
- A dealer to a consumer
It also includes any gasoline sold to a dealer of aviation gasoline for dispensing directly into the fuel tank of an aircraft.
Tax Rates and Reporting Requirements
The tax rate depends on the type of gasoline. The rate for most aviation gasoline is 5 cents per gallon. All taxes, inspection fees, and cleanup fees (when applicable) are to be reported and paid by the first consignee. If the consignee is not a licensed distributor, the supplier will be responsible for all taxes and fees.
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Gasoline for aviation purposes is 87-, 89-, or 90-octane gasoline, or any other gasoline that meets ASTM specifications as aviation gasoline.
Distributors must collect the full gasoline tax rate when selling this fuel unless it is sold to a dealer of aviation gasoline at an airport for dispensing directly into the supply tank of an aircraft.
Jet fuel and aviation turbine fuel are blends of hydrocarbons for use in aviation turbine engines and meet ASTM specification D 1655-96c.
The tax on these types of fuel is 15 cents per gallon. The tax can be reported and paid by a supplier, licensed distributor, licensed special fuel dealer, or bulk purchaser.
Inspection and Cleanup Fees
The inspection fee and cleanup fee (when applicable) must be reported and paid by the first licensed distributor consignee. If the first consignee is not a licensed distributor, these fees must be paid by the supplier.
Jet fuel and aviation turbine fuel cannot be sold without inspection and cleanup fee but can be sold without the 15 cents per gallon excise tax between licensed accounts.
Responsibility for Taxes and Fees
The individual responsible for the taxes and fees depends on how the fuel is sold:
- Licensed distributor/supplier selling jet fuel to a non-licensed customer: The licensed distributor or supplier charges and collects all the taxes and fees and includes them on the tax returns filed to the state of Minnesota.
- Licensed distributor selling jet fuel to a licensed special fuel customer: The licensed distributor charges and collects the inspection fee and cleanup fee (when applicable). The licensed special fuel customer is responsible for paying the 15 cents per gallon tax on their special fuel tax return.
- Licensed distributor selling jet fuel to a licensed distributor: The first licensed distributor charges and collects the inspection fee and cleanup fee (when applicable).
If the second distributor then sells this product to a non-licensed account, the second distributor collects and remits the 15 cents per gallon tax.
If the second distributor sells to a licensed special fuel customer, the special fuel customer remits the 15 cents per gallon tax on their special fuel tax return.
Aviation gasoline may be purchased from a supplier that is not a dealer of aviation gasoline.
The tax on this type of gasoline is 28.5 cents per gallon.
The owner of the aircraft may request an aviation gas tax credit by filing Form PDR-1AV, Aviation Fuel Tax Claim for Refund. The owner must include a Form FAA 337 with the claim that the aircraft can burn this type of gasoline.
Note: Tax-free sales of these types of gasoline are not allowed between licensed distributors.
Licensed distributors may sell gasoline for aviation purposes to dealers of aviation gasoline at the tax rate of 5 cents per gallon if it is delivered to a dedicated storage tank and retail pump used only for fueling aircraft at an airport.
When distributors sell automobile gas for resale to dealers of aviation at airports, the distributors must report the sale as a schedule code 5XA – Gallons Sold to Airport Partial Taxed and use product code 065 or 124 to claim the 23.5 cents per gallon credit.
When distributors purchase gasoline from a terminal, they report the purchase as a schedule 2A/2C and product code 065 or 124.
Dealers of aviation gasoline may purchase gasoline for aviation purposes for resale at the airport.
To purchase the fuel at the tax rate of 5 cents per gallon, dealers must meet the following requirements:
- The storage tank and retail pump must be dedicated to only refueling aircraft. This fuel may only be dispensed directly into the fuel tank of an airplane.
- Dealers must keep complete and accurate sales records for all withdrawals of gasoline for aviation purposes and must include the following information:
- Date of sale
- Number of gallons sold
- Price per gallon of fuel sold
- Amount of tax being charged
- Name of purchaser
- Tail number of aircraft
