Indiana – Guidance Issued Regarding Aviation Fuel Excise Tax

SALT Report 2731– The Commissioner of the Indiana Department of Revenue issued a directive regarding the recently enacted aviation fuel excise tax.  Pursuant to HEA 1545-2013 an aviation fuel excise tax of $.10 per gallon is imposed on the gross retail income received by a retailer for each gallon of aviation fuel purchased in the State.

Exemptions

Aviation Fuel Excise Tax Exemption

An exemption from the aviation fuel excise tax is available for wholesalers.  The exemption also applies to aviation fuel that is placed in the fuel supply tank of an aircraft owned by:

  • The United States or an agency or instrumentality of the United States,
  • The state of Indiana,
  • The Indiana Air National Guard, or
  • A common carrier of passengers or freight

Anyone claiming the exemption is required to present a signed AVF-105, Aviation Fuel Excise Tax Exemption Certificate to the retailer instead of paying the tax. The form must be kept on file at the retailer’s location.

Sales Tax Exemption

Pursuant to IC 6-2.5-5-49, transactions involving aviation fuel are exempt from the state gross retail tax.  Because aviation fuel is exempt from sales tax, there is no requirement for retail merchants to prepay sales tax on purchases of aviation fuel.

The Commissioner’s directive also provides guidance regarding remittance and reporting requirements, penalties, and definitions.

These provisions were effective July 1, 2013.

For Further Information

Indiana Department of Revenue – Commissioner’s Directive No. 49