California – Fuel Prepayment Rates

SALT Report 1323 – Effective April 1, 2012, the California sales tax prepayment rates for fuel will increase as follows:

  • Motor vehicle fuel (gasoline) from .05 1/2 cents to .07 cents
  • Aircraft jet fuel from .14 cents to .18 cents, and
  • Diesel fuel from .25 cents to 26.5 cents
Effective July 1, 2012, Revenue and Taxation Code section 6051.8 and 6201.8 provide that the state sales and use tax rate of diesel fuel will change. The tax rate for sales of diesel fuel will increase to 9.42%, plus any additional district taxes.  If you sell diesel fuel, you will be affected by this tax rate change.  When reporting diesel fuel transactions on line 15 of the sales and use tax return (BOE-401-GS), do not report red dyed diesel as it is exempt from the additional state tax.
The prepayment rate for each gallon of motor vehicle fuel, aircraft jet fuel and diesel fuel is 80% of the combined state and local sales tax rate on the average selling price of the fuel, excluding sales tax, as determined by industry publications.
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