Motor Fuels Tax Minute, Episode 5

On this episode, Leanne Sobel and Emilda Santiesteban discuss products that are defined as gasoline blendstocks for the purpose of the federal excise tax as well as those defined as taxable chemicals subject to the Superfund tax.


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Detailed Transcription of Weaver’s Motor Fuels Tax Minute, Episode 5


Emilda: Welcome to Weaver's Motor Fuels Tax Minute, where we talk all things motor fuels tax. This week we are talking about products that are within the definition of both gasoline blendstocks for the purpose of the federal excise tax and also taxable chemicals subject to the Superfund tax.


Leanne: That's right. The Superfund tax contains a specific exemption for certain chemicals that are used in the manufacture of motor fuel, or which themselves are used as a fuel. Motor fuel in this instance is gasoline, diesel, aviation fuel or jet fuel. The list of exempt chemicals in the Superfund statutes includes butane, toluene and xylene.


Emilda: So, Leanne, a question that continues to come up since the reinstatement of the Superfund tax is, can a taxpayer use a blendstock certificate to claim the Superfund tax exemption? And the answer is no. The blendstock certificate should be used by the taxpayer when claiming an exemption from the federal fuel excise tax when blendstocks are purchased for use other than blending into motor fuel. The Superfund exemption is for chemicals that are blended into motor fuel.


Leanne: That's right. Another important point is that the blendstock certificate isn't approved for use with the Superfund tax. While we are still awaiting the publication of certificates for use with respect to Superfund exemptions, taxpayers can issue a signed statement on company letterhead claiming an applicable exemption. For toluene, butane and xylene that's used in motor fuel blending, the taxpayer can state that this is the purpose for which the chemicals are purchased, and therefore, that's the exemption claimed.


Emilda: And it's important to note too Leanne that the taxpayer cannot issue both a blendstock certificate and a Superfund motor fuel blending exemption certificate. That would be inconsistent.


Leanne: The key takeaway here is to know the use of butane, toluene, or xylene, before issuing either certificate to ensure the correct one is issued. That is this week's motor fuels tax minute. Stay tuned next week when we'll be discussing the use of the gasoline blendstock certificate to exempt products from the motor fuel excise tax.

Weaver's Motor Fuels Tax Minute

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Leanne Sobel

Leanne Sobel

Director, Motor Fuels and Excise Tax Services


Leanne Sobel, J.D., has over 15 years of experience in legal tax matters. Her career focus includes federal and state tax and…

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