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Administrative Procedure

Administrative Procedure AP 110: Gasoline Excise

Date: 01/30/2018
Organization: Massachusetts Department of Revenue
Referenced Sources: Massachusetts General Laws

Sales and Use Tax

      General: In order to qualify as a gasoline distributor, a person must be qualified to do business in the Commonwealth. Any person who produces, refines, manufactures or compounds gasoline or who operates a port or pipe line terminal in the Commonwealth for the receipt of fuel must license as a gasoline distributor. Any person may elect to qualify as a distributor providing that he imports or receives into the Commonwealth fuel for bulk resale, providing his regular Massachusetts receipt and storage facility has a minimum capacity of 25,000 gallons at one location. Furthermore, 75% of a distributor's sales must be to others for resale, exclusive of sales to government instrumentalities. A distributor may acquire its gasoline from both domestic and foreign sources, on a tax free basis.

 

      An unclassified exporter is a person who exports or causes to export, gasoline, outside the Commonwealth. In order to become an exporter, a person must be duly licensed in another state. The gasoline exported shall be purchased on a tax free basis. All other gasoline purchased within the Commonwealth shall include the state excise tax.

 

      An unclassified importer is a person who imports or causes to be imported gasoline for use or sale within the Commonwealth. The tax is due on the total number of gallons imported. The gasoline purchased within the Commonwealth shall include the state excise tax.

 

      Applications for Licenses: Distributors, importers and exporters of gasoline in Massachusetts must file with the Department of Revenue (DOR) a Gasoline License Application (Form GT-1) online through MassTaxConnect (MTC). There is a $100 fee for all licenses. Licenses must be renewed each year by January 1st. All returns must be filed and outstanding taxes must be paid before a license as a distributor, importer or exporter will be granted or renewed.

 

      Filing Requirements: Distributors, importers, and exporters of gasoline in Massachusetts must file a Gasoline Tax Return, Form GT-456. Returns must be filed on or before the 20th day of each month for purchases and sales in the previous month. Returns must be filed even if no tax is due. Taxpayers licensed as both an unclassified importer and an unclassified exporter should report all activity on one return. Businesses with certain combined tax liabilities at or exceeding $5,000 must file electronically through MTC. See TIR 16-9. 

 

      Payment: Distributors and importers with total annual payments in excess of $5,000 must make payments electronically through MTC. Failure to make electronic payments may result in a penalty under G.L. c. 62C, § 33(g). For those not required to make electronic payments, the payment must be included with the monthly return. The check or money order for the exact amount should be made payable to the Commonwealth of Massachusetts.

 

      Rate of Tax: The rate of tax is $.24 per gallon. For aviation fuel the rate is 7.5% of the average price, as determined by the Commissioner for each calendar quarter, computed to the nearest 10th of a cent per gallon; the minimum tax is $.10/gallon. All licensees filing aviation gasoline returns will be notified of the rate approximately four (4) weeks before the beginning of the calendar quarter. The current aviation gasoline tax rate is also published on the DOR website.

 

      Exemptions: The following sales or uses are either exempt from tax or may entitle the purchaser to a refund: (1) sales to the federal government; (2) sales in foreign or interstate commerce, except where permitted under the Constitution and laws of the United States; (3) sales to foreign embassies; (4) sales by one licensed distributor to another or to a person duly licensed in another state (under certain restrictions); (5) sales to regional transportation authorities and certain authorities including MWRA, MBTA and MASSPORT; (6) sales of gasoline for propelling any vehicle on a turnpike constructed by the Massachusetts Turnpike Authority; (7) sales of gasoline for off‑highway use; and (8) sales of gasoline for farm purposes. In certain instances, sales or use tax may nonetheless apply.

 

      Interest and Penalties: If returns are not properly filed, interest and penalties may be assessed. The Massachusetts interest rate is based on the federal short‑term rate plus four percentage points, compounded daily. G.L. c. 62C, § 32, as amended. For more information on calculation of interest, see 830 CMR 62C.33.1. Quarterly TIRs are issued to announce interest rates. The penalty for late filing is 1%/month or fraction thereof, not to exceed 25% of the amount due; and the penalty for late payment is 1%/month for each month or fraction thereof, not to exceed 25% of the amount due.

 

      See TIR 99-18 regarding waiver of G.L. c. 62C, § 33(c) late‑pay penalties and suspension or involuntary collection activities under G.L. c. 62C, § 32(e) when the taxpayer disputes the assessment (or any portion thereof) administratively within DOR or with the Appellate Tax Board or Probate Court.

 

      Extensions of Time to File: For good cause, the Commissioner may grant a reasonable extension of time for filing a return. Requests must be in writing to the address given below. However, failure to pay 80% of the tax required to be paid on or before the due date for payment of tax will void any extension of time to file and the return will be subject to penalty as a late return.

 

      Amended Returns: Taxpayers often discover after filing a return that information was omitted or a mistake was made. To adjust information reported on a prior return, a taxpayer must file an amended return with DOR. An amended return must be filed to increase previously reported tax; to decrease previously reported tax; to report an increase to tax resulting from a federal or state change; to report a decrease resulting from a federal or state change and to make amendments that have no net effect on tax. Most taxpayers are required to amend their returns electronically using MTC. Taxpayers filing amended returns on paper will manually complete the same form as used for the original or prior amended return, whichever is filed later, and check the box indicating that the return is an amended. See AP 605, Amending Tax Returns for more details.                                               

 

      Refunds: Users of gasoline may submit refund applications.

 

      Use the following forms to apply for gasoline refunds:                        

Type 

Form

Off‑Highway Use

GT-9, Gasoline Refund Application

Farm

GT-9A, Gasoline Refund Application for Those Engaged in Farming

Watercraft

GT-9M, Gasoline Refund Application – Watercraft Use

Massachusetts Turnpike

GT-9T, Gasoline Refund Application for Massachusetts Turnpike Use

Motor carrier (IFTA)* 

IFTA-100, IFTA Quarterly Fuel Use Tax Return*

* A motor carrier licensed under the International Fuel Tax Agreement (IFTA) applies for a gasoline tax refund for gasoline consumed on the Massachusetts Turnpike on its IFTA-100, IFTA Quarterly Fuel Use Tax Return. Massachusetts Turnpike miles are included in the total IFTA miles, but are excluded from the Massachusetts taxable miles. An IFTA motor carrier claiming this exemption must file a Business Use Tax Return (Form ST-10) and pay the 6.25% use tax on the fuel consumed in exempt travel on the Massachusetts Turnpike.  

 

      All refund claims must be filed within two years of the date of purchase except:

 

(1) farm: Form GT-9A must be filed on or before the fifteenth day of the fourth month following the close of the taxable year of the purchase;

 

(2) watercraft: Form GT-9M must be filed within 6 months of the purchase or invoice.

 

      No refund may be claimed for gasoline or special fuel for which Massachusetts fuels excise was not paid.

 

      Abatements: An abatement is a reduction of a tax or penalty assessed by DOR. See 830 CMR 62C.37.1. Taxpayers seeking to obtain an abatement of a tax or penalty that has been assessed by DOR should use MTC and follow the instructions provided for disputing a tax or penalty assessed by DOR. Alternatively, taxpayers may file a paper Form ABT, Application for Abatement. However, abatement applications filed electronically through MTC will be processed faster than paper applications. Note that taxpayers that are required to file their taxes electronically must also file abatement requests electronically. See AP 627, Applications for Abatement for more details. 

 

      Changing Information or Status: Changes should be made electronically through MTC. A taxpayer who does not have access to MTC may submit changes to the address given below.

 

      Interest: Refund payments are not subject to interest.

 

 

For more information, contact:

 

Massachusetts Department of Revenue

Excises Unit, Gasoline Tax Section

P.O. Box 7012

Boston, MA 02204

(617) 887-5070

 

G.L. c. 62C, §§ 32, 32(e), 33(c), 33(g)

830 CMR 62C19.1

830 CMR 62C.33.1

TIR 92-6

TIR 99-18

TIR 16-9

Form ABT, Application for Abatement

Form GT-1, Gasoline License Application

Form GT-9, Gasoline Refund Application

Form GT-9A, Gasoline Refund Application for Those Engaged in Farming

Form GT-9M, Gasoline Refund Application – Watercraft Use

Form GT-9T, Gasoline Refund Application for Massachusetts Turnpike Use

Form GT-456, Gasoline Tax Return

Form ST-10, Business Use Tax Return

IFTA-100, IFTA Quarterly Fuel Use Tax Return  

Referenced Sources:

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