Motor Fuel Tax History


2017 Session

  • The special excise tax of 4% of the cost of fuel, exclusive of tax, which was imposed on consumers who claimed and received a refund of the tax imposed by N.D.C.C. 57-43.3-02 was repealed.

2015 Session

  • The 7 cents per gallon withheld from agricultural refunds of motor vehicle tax for deposit in the Agricultural Research Fund was eliminated. Five hundred thousand dollars is transferred from sales on farm machinery and irrigation equipment for deposit in the Agricultural Research Fund.
  • A conversion factor for liquified natural gas (LNG) of 1.7 gallons to a diesel gallon equivalent (DGE) was provided for special fuel tax purposes.

2013 Session

  • A special fuel tax exemption is provided for liquefied natural gas (LNG) used for an agricultural, industrial, or railroad purpose after an LNG liquefaction plant is constructed in North Dakota.
  • The entire 7¢ per gallon withheld from agricultural refunds of motor vehicle tax is deposited in the Agricultural Research Fund.
  • A consumer advisory is required to be displayed on all retail pumps dispensing dyed special fuel providing information regarding the administrative fee imposed for use of dyed special fuel in a licensed motor vehicle.
  • Provided for increased administrative fees for first, second, third, and fourth violations for use of dyed special fuel in a licensed motor vehicle.

2011 Session

  • Based on information provided on a special fuel license application, the Tax Commissioner may make a determination if a special fuel license is required.
  • Cooperative agreements between agencies are allowed for the exchange of information regarding interstate and international motor fuel use.

2007 Session 

  • Motor fuel refunds are available for emergency medical services. 
  • The special fuels excise tax rate for all special fuels, except LPG, changed from 2% of the value to 4 cents per gallon. 
  • The special fuels excise tax rate for heating fuel was reduced to 1% for LPG and 2 cents per gallon for all other special fuels through June 30, 2009; beginning July 1, 2009, heating fuels are exempt from tax. 
  • Taxpayers are required to report actual physical inventories on a monthly basis. 
  • The requirement that tax be listed as a separate item, or a statement that the tax is included in the price, on a claim for refund was repealed.

2009 Session 

  • Township highway aid funds are no longer withheld from refunds, townships receive 2.7% of highway funds. 
  • Counties, cities, and townships are required to submit annual reports providing information on use of revenue received for transportation purposes. 
  • Refunds are allowed for the difference between off-road and on-road rates on diesel fuel when on-road fuel is used in the refrigeration unit on a truck with a separate supply tank. 
  • Special fuel tax collected from the sale of diesel fuel to railroads up to $1.6 million is dedicated to a fund to be used for crossing safety purposes. 
  • Allows cities with a computerized tracking system for vehicle fuel use to use off-road fuel and report and pay the difference between the off-road fuel and on-road fuel rates.

2005 Session

  • The legislature provided for an increase in the tax rates for both motor vehicle fuel and special fuels from 21 cents per gallon to 23 cents per gallon.
  • E85 was defined and a reduced rate of 1 cent per gallon was imposed on all E85 sold in the state until a total of 1.2 million gallons were sold, at which time the tax rate reverted to the 23 cents motor fuel tax rate.
  • A special fuels tax exemption was provided through June 30, 2010, for the sale of hydrogen used to fuel an internal combustion engine or fuel cell. 
  • The legislature provided for motor vehicle and special fuel tax refunds to Native Americans and established a refund reserve fund for this purpose.

2001 Session

  • The legislature enacted a decrease in special fuels taxes on diesel fuel containing at least 2% biodiesel fuel by weight. The decrease is contingent upon the opening of a biodiesel refining facility in this state with a production capacity of at least 10 million gallons biodiesel per year. If triggered, the tax on undyed diesel fuel containing biodiesel is reduced by one and five-hundredths cents per gallon, and the tax on dyed diesel fuel containing biodiesel is reduced to 1.9%.

1999 Session

  • The legislature reenacted the motor vehicle fuel and special fuels tax statutes and increased the taxes to 21 cents per gallon.
  • The legislature also repealed the refund provisions for special fuel taxes and enacted a dyed fuel enforcement program. Dyed diesel fuel may not be used in licensed motor vehicles, and in the event of a violation, administrative fees may be assessed.

1997 Session

  • The legislature provided for a permanent 20 cents per gallon motor vehicle fuel tax and special fuels tax through December 31, 1999 and added a provision to the special fuels tax chapter allowing the 2% special fuels excise tax to be charged on fuel dyed for federal motor fuel tax exemption purposes. 
  • The legislature also revised refund requirements to allow refunds of motor vehicle fuel tax and special fuels tax to industrial fuel users when the fuel was used in nonlicensed equipment on publicly funded projects.
  • An additional 4 cents per gallon is withheld from agricultural consumer refund claims for deposit into an agricultural research fund, and the amount withheld for ethanol production incentives was lowered from 2 cents per gallon to 1 cent per gallon.

1995 Session

  • The legislature continued to "trigger" changes in the motor vehicle fuel tax and special fuels tax rates depending on the availability of additional federal highway matching funds. The rate increased to 20 cents per gallon for the period January 1, 1996 through December 31, 1997.