CHAPTER 7. COLLECTION AND REMITTANCE OF STATE GROSS RETAIL TAX ON MOTOR FUEL
IC 6-2.5-7
Chapter 7. Collection and Remittance of State Gross Retail Tax
on Motor Fuel
IC 6-2.5-7-1
Definitions
Sec. 1. (a) The definitions in this section apply throughout this
chapter.
(b) "Kerosene" has the same meaning as the definition contained
in IC 16-44-2-2.
(c) "Gasoline" has the same meaning as the definition contained
in IC 6-6-1.1-103.
(d) "Special fuel" has the same meaning as the definition
contained in IC 6-6-2.5-22.
(e) "E85" has the meaning set forth in IC 6-6-1.1-103.
(f) "Unit" means the unit of measure, such as a gallon or a liter, by
which gasoline or special fuel is sold.
(g) "Metered pump" means a stationary pump which is capable of
metering the amount of gasoline or special fuel dispensed from it and
which is capable of simultaneously calculating and displaying the
price of the gasoline or special fuel dispensed.
(h) "Indiana gasoline tax" means the tax imposed under
IC 6-6-1.1.
(i) "Indiana special fuel tax" means the tax imposed under
IC 6-6-2.5.
(j) "Federal gasoline tax" means the excise tax imposed under
Section 4081 of the Internal Revenue Code.
(k) "Federal special fuel tax" means the excise tax imposed under
Section 4041 of the Internal Revenue Code.
(l) "Price per unit before the addition of state and federal taxes"
means an amount which equals the remainder of:
(1) the total price per unit; minus
(2) the state gross retail, Indiana gasoline or special fuel, and
federal gasoline or special fuel taxes which are part of the total
price per unit.
(m) "Total price per unit" means the price per unit at which
gasoline or special fuel is actually sold, including the state gross
retail, Indiana gasoline or special fuel, and federal gasoline or special
fuel taxes which are part of the sales price.
(n) "Distributor" means a person who is the first purchaser of
gasoline from a refiner, a terminal operator, or supplier, regardless
of the location of the purchase.
(o) "Prepayment rate" means a rate per gallon of gasoline
determined by the department under section 14 of this chapter for use
in calculating prepayment amounts of gross retail tax under section
9 of this chapter.
(p) "Purchase or shipment" means a sale or delivery of gasoline,
but does not include:
(1) an exchange transaction between refiners, terminal
operators, or a refiner and terminal operator; or
(2) a delivery by pipeline, ship, or barge to a refiner or terminal
operator.
(q) "Qualified distributor" means a distributor who:
(1) is a licensed distributor under IC 6-6-1.1; and
(2) holds an unrevoked permit issued under section 7 of this
chapter.
(r) "Refiner" means a person who manufactures or produces
gasoline by any process involving substantially more than the
blending of gasoline.
(s) "Terminal operator" means a person that:
(1) stores gasoline in tanks and equipment used in receiving and
storing gasoline from interstate or intrastate pipelines pending
wholesale bulk reshipment; or
(2) stores gasoline at a boat terminal transfer that is a dock or
tank, or equipment contiguous to a dock or tank, including
equipment used in the unloading of gasoline from a ship or
barge and used in transferring the gasoline to a tank pending
wholesale bulk reshipment.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.81-1983,
SEC.1; P.L.94-1987, SEC.1; P.L.277-1993(ss), SEC.41;
P.L.222-1999, SEC.1; P.L.122-2006, SEC.2; P.L.176-2006, SEC.1;
P.L.1-2007, SEC.52.
IC 6-2.5-7-2
Display of price
Sec. 2. Except as provided in section 2.5 of this chapter, a retail
merchant who uses a metered pump to dispense gasoline or special
fuel shall display on the pump the total price per unit of the gasoline
or special fuel. Subject to the provisions of section 2.5 of this
chapter, a retail merchant may not advertise the gasoline or special
fuel at a price that is different than the price that he is required to
display on the metered pump.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.81-1983,
SEC.2.
IC 6-2.5-7-2.5
Pumps designated for trucks only; requirements
Sec. 2.5. (a) A retail merchant may designate any metered pumps
at a business location that dispense special fuel as being "for trucks
only". To do this, a retail merchant must place on the pump a sign
that states that fuel dispensed from the metered pump may only be
placed in the fuel supply tanks of a truck. A sign that reads
"TRUCKS ONLY" is sufficient to meet the requirements of this
subsection.
(b) A retail merchant may not dispense special fuel from a
metered pump that is designated for trucks only into the supply tank
of a vehicle that is not a truck.
(c) A retail merchant is not required to display the total price per
unit of the special fuel on a metered pump if that particular metered
pump is designated for trucks only.
(d) A retail merchant may advertise special fuel at a price that
does not include gross retail taxes that may be due on the sale of the
special fuel only if he maintains a metered pump that is designated
for trucks only. If a retail merchant advertises special fuel at a price
that does not include any gross retail taxes that may be due on the
sale of the special fuel, the retail merchant must display in easily
read lettering above or below the advertised price the words
"EXEMPT TRUCKS ONLY".
As added by P.L.81-1983, SEC.3.
IC 6-2.5-7-3
Retail merchant; calculation of tax liability; metered pump sales;
gasoline; kerosene; special fuels
Sec. 3. (a) With respect to the sale of gasoline which is dispensed
from a metered pump, a retail merchant shall collect, for each unit of
gasoline sold, state gross retail tax in an amount equal to the product,
rounded to the nearest one-tenth of one cent ($0.001), of:
(1) the price per unit before the addition of state and federal
taxes; multiplied by
(2) seven percent (7%).
The retail merchant shall collect the state gross retail tax prescribed
in this section even if the transaction is exempt from taxation under
IC 6-2.5-5.
(b) With respect to the sale of special fuel or kerosene which is
dispensed from a metered pump, unless the purchaser provides an
exemption certificate in accordance with IC 6-2.5-8-8, a retail
merchant shall collect, for each unit of special fuel or kerosene sold,
state gross retail tax in an amount equal to the product, rounded to
the nearest one-tenth of one cent ($0.001), of:
(1) the price per unit before the addition of state and federal
taxes; multiplied by
(2) seven percent (7%).
Unless the exemption certificate is provided, the retail merchant shall
collect the state gross retail tax prescribed in this section even if the
transaction is exempt from taxation under IC 6-2.5-5.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.2-1982(ss),
SEC.5; P.L.81-1983, SEC.4; P.L.80-1983, SEC.2; P.L.11-1984,
SEC.2; P.L.222-1999, SEC.2; P.L.192-2002(ss), SEC.63;
P.L.146-2008, SEC.314.
IC 6-2.5-7-4
Exempt transactions; refunds; procedures
Sec. 4. (a) If a sale of gasoline or special fuel is exempt from the
state gross retail tax, the person who pays the tax to the retail
merchant may file a claim for refund with the department. The
person must file the claim on the form, in the manner, and with the
supporting documentation, prescribed by the department. If a person
properly files a claim for refund, the department shall refund to him
the state gross retail tax collected with respect to the exempt
transaction.
(b) Notwithstanding the other provisions of this section, the
department may prescribe simplified procedures to make adjustments
for exempt transactions.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.81-1983,
SEC.5.
IC 6-2.5-7-5
Reports by gasoline or special fuel retail merchants; remitted tax
amount; deduction of prepayment amounts; deduction of E85
retail sales credit; limitation on deductions; suspension
Sec. 5. (a) Each retail merchant who dispenses gasoline or special
fuel from a metered pump shall, in the manner prescribed in
IC 6-2.5-6, report to the department the following information:
(1) The total number of gallons of gasoline sold from a metered
pump during the period covered by the report.
(2) The total amount of money received from the sale of
gasoline described in subdivision (1) during the period covered
by the report.
(3) That portion of the amount described in subdivision (2)
which represents state and federal taxes imposed under this
article, IC 6-6-1.1, or Section 4081 of the Internal Revenue
Code.
(4) The total number of gallons of special fuel sold from a
metered pump during the period covered by the report.
(5) The total amount of money received from the sale of special
fuel during the period covered by the report.
(6) That portion of the amount described in subdivision (5) that
represents state and federal taxes imposed under this article,
IC 6-6-2.5, or Section 4041 of the Internal Revenue Code.
(7) The total number of gallons of E85 sold from a metered
pump during the period covered by the report.
(b) Concurrently with filing the report, the retail merchant shall
remit the state gross retail tax in an amount which equals six and
fifty-four hundredths percent (6.54%) of the gross receipts, including
state gross retail taxes but excluding Indiana and federal gasoline and
special fuel taxes, received by the retail merchant from the sale of the
gasoline and special fuel that is covered by the report and on which
the retail merchant was required to collect state gross retail tax. The
retail merchant shall remit that amount regardless of the amount of
state gross retail tax which the merchant has actually collected under
this chapter. However, the retail merchant is entitled to deduct and
retain the amounts prescribed in subsection (c), IC 6-2.5-6-10, and
IC 6-2.5-6-11.
(c) A retail merchant is entitled to deduct from the amount of state
gross retail tax required to be remitted under subsection (b) the
amount determined under STEP THREE of the following formula:
STEP ONE: Determine:
(A) the sum of the prepayment amounts made during the
period covered by the retail merchant's report; minus
(B) the sum of prepayment amounts collected by the retail
merchant, in the merchant's capacity as a qualified
distributor, during the period covered by the retail
merchant's report.
STEP TWO: Subject to subsections (d) and (f), for qualified
reporting periods beginning after June 30, 2009, and ending
before July 1, 2020, determine the product of:
(A) eighteen cents ($0.18); multiplied by
(B) the number of gallons of E85 sold at retail by the retail
merchant during the period covered by the retail merchant's
report.
STEP THREE: Add the amounts determined under STEPS
ONE and TWO.
For purposes of this section, a prepayment of the gross retail tax is
presumed to occur on the date on which it is invoiced.
(d) The total amount of deductions allowed under subsection (c)
STEP TWO may not exceed the amount of money that the budget
agency determines is available in the retail merchant E85 deduction
reimbursement fund established under IC 15-15-12-30.5 for the
deductions for all retail merchants in a particular qualified reporting
period. A retail merchant is not required to apply for an allocation of
deductions under subsection (c) STEP TWO. Before August 1 of
each year, the budget agency shall estimate whether the amount of
deductions from the immediately preceding qualified reporting
period that are subject to reimbursement under IC 15-15-12-30.5(f)
and the deductions expected to be reported under subsection (c)
STEP TWO for the qualified reporting periods beginning after
December 31 and ending before April 1 of the following year will
exceed the amount of money available in the retail merchant E85
deduction reimbursement fund for the deductions. If the budget
agency determines that the amount of money in the retail merchant
E85 deduction reimbursement fund is insufficient to cover the
amount of the deductions expected to be reported, the budget agency
shall publish in the Indiana Register a notice that the deduction
program under subsection (c) STEP TWO is suspended with respect
to the qualified reporting periods occurring in the following calendar
year and that no deductions will be granted for retail transactions
occurring in the qualified reporting periods occurring in the
following calendar year.
(e) As used in this section, "qualified reporting period" refers to
a reporting period beginning after December 31 and ending before
April 1 of each year.
(f) The budget agency may suspend the deduction program under
subsection (c) STEP TWO for a particular year at any time during a
qualified reporting period if the budget agency determines that the
amount of money in the retail merchant E85 deduction
reimbursement fund and the amount of money that will be transferred
to the fund on July 1 will not be sufficient to reimburse the
deductions expected to occur before the deduction program for the
year ends on March 31. The budget agency shall immediately
provide notice to the participating retail merchants of the decision to
suspend the deduction program for that year.
As added by Acts 1980, P.L.52, SEC.1. Amended by Acts 1980,
P.L.10, SEC.2; P.L.2-1982(ss), SEC.6; P.L.81-1983, SEC.6;
P.L.80-1983, SEC.3; P.L.11-1984, SEC.3; P.L.94-1987, SEC.2;
P.L.277-1993(ss), SEC.42; P.L.192-2002(ss), SEC.64; P.L.122-2006,
SEC.3; P.L.182-2007, SEC.1; P.L.146-2008, SEC.315;
P.L.148-2009, SEC.2.
IC 6-2.5-7-5.5
Repealed
(Repealed by P.L.148-2009, SEC.11.)
IC 6-2.5-7-6
Prepayment credit; claim for refund; transfers from general fund
Sec. 6. (a) If the deduction under section 5(c) of this chapter
exceeds the amount of gross retail tax required to be remitted under
section 5(b) of this chapter, the retail merchant is entitled to a credit.
The credit shall be used as follows:
(1) First, the credit shall be applied against gross retail and use
tax liability of the retail merchant that is required to be remitted
under IC 6-2.5-6.
(2) Second, any amount remaining shall be applied against the
gasoline tax liability of the retail merchant, as determined under
IC 6-6-1.1, excluding any liability for gasoline delivered to a
taxable marine facility.
A retail merchant may file a claim for a refund instead of taking a
credit or for a refund of any excess tax payment remaining after the
credits allowed by this section. In addition, a retail merchant may file
a claim for a refund under section 12 of this chapter.
(b) A retail merchant that is entitled to a refund under this section
must file a claim for the refund on the form approved by the
department and must include any supporting documentation
reasonably required by the department. If a retail merchant files a
completed refund claim form that includes all supporting
documentation, the excess tax payment that is not refunded within
ninety (90) days accrues interest as provided in IC 6-8.1-9-2.
(c) Before the fifth day of each month, the department shall
determine and notify the treasurer of state of the amount of credits
applied during the preceding month against the gasoline tax under
this section. The treasurer of state shall transfer from the general
fund:
(1) to the highway, road, and street fund, twenty-five percent
(25%) of the amount set forth in the department's notice; and
(2) to the motor fuel tax fund of the motor vehicle highway
account, seventy-five percent (75%) of the amount set forth in
the department's notice.
As added by P.L.94-1987, SEC.3.
IC 6-2.5-7-7
Distributor permit to collect prepayment from retail merchants
Sec. 7. (a) A distributor desiring to receive gasoline within
Indiana without prepaying gross retail tax must hold an uncancelled
permit issued by the department to collect prepayments of gross
retail tax from retail merchants.
(b) To obtain a permit, a distributor must file with the department
a sworn application containing information that the department
reasonably requires.
(c) The department may refuse to issue a permit to a distributor if:
(1) the application is filed by a distributor whose permit has
previously been cancelled for cause;
(2) the application is not filed in good faith, as determined by
the department; or
(3) the application is filed by some person as a subterfuge for
the real person in interest whose permit has previously been
cancelled for cause.
(d) A permit may not be issued unless the application is
accompanied by an audited and current financial statement and a
license fee of one hundred dollars ($100).
(e) A permit issued under this section is not assignable and is
valid only for the distributor in whose name it is issued. If there is a
change in name or ownership, the distributor must apply for a new
permit.
(f) The department may revoke a distributor's permit for good
cause.
(g) Before being denied a permit under subsection (c) or before
having a permit revoked under subsection (f), a distributor is entitled
to a hearing after five (5) days written notice. At the hearing the
distributor may appear in person or by counsel and present
testimony.
(h) The department shall keep a record of all qualified
distributors.
As added by P.L.94-1987, SEC.4.
IC 6-2.5-7-8
Distributor permittees; bond; financial statements
Sec. 8. (a) The department may require a distributor to file,
concurrently with the filing of an application for a permit, a bond:
(1) in an amount of not less than two thousand dollars ($2,000)
nor more than a three (3) month prepayment tax liability for the
distributor, as estimated by the department;
(2) in cash or with a surety company approved by the
department;
(3) upon which the distributor is the principal obligor and the
state is the obligee; and
(4) conditioned upon the prompt filing of true reports and
payment of all prepayment of gross retail taxes collected by the
distributor, together with any penalties and interest, and upon
faithful compliance with this chapter.
The department shall determine the amount of the distributor's bond,
if any.
(b) If after a hearing (after at least five (5) days written notice) the
department determines that the amount of a distributor's bond is
insufficient, the distributor shall upon written demand of the
department file a new bond.
(c) The department may require a distributor to file a new bond
with a satisfactory surety in the same form and amount if:
(1) liability upon the old bond is discharged or reduced by
judgment rendered, payment made, or otherwise; or
(2) in the opinion of the department any surety on the old bond
becomes unsatisfactory.
(d) If a new bond obtained under subsection (b) or (c) is
unsatisfactory, the department shall cancel the permit of the
distributor. If the new bond is satisfactorily furnished, the department
shall release in writing the surety on the old bond from any liability
accruing after the effective date of the new bond.
(e) Sixty (60) days after making a written request for release to
the department, the surety of a bond furnished by a distributor is
released from any liability to the state accruing on the bond. The
release does not affect any liability accruing before expiration of the
sixty (60) day period. The department shall promptly notify the
distributor furnishing the bond that the surety has requested release.
Unless the distributor obtains a new bond that meets the
requirements of this section and files the new bond with the
department within the sixty (60) day period, the department shall
cancel the distributor's permit.
(f) The department may require a distributor to furnish audited
annual financial statements to determine if any change is required in
the amount of the distributor's bond.
As added by P.L.94-1987, SEC.5. Amended by P.L.71-1993, SEC.11.
IC 6-2.5-7-9
Amount of prepayment
Sec. 9. (a) Except as provided in section 13 of this chapter, at the
time of purchase or shipment of gasoline from a refiner or terminal
operator, a distributor who is not a qualified distributor shall prepay
to the refiner or terminal operator the state gross retail tax in an
amount determined under subsection (d).
(b) At the time of purchase or shipment of gasoline from a
qualified distributor, a retail merchant shall prepay to the qualified
distributor the state gross retail tax in an amount determined under
subsection (d).
(c) If gasoline is delivered to a retail outlet for resale and the gross
retail tax in the amount determined under subsection (d) has not been
prepaid on the gasoline, the refiner, terminal operator, or qualified
distributor making the delivery shall prepay to the department the
gross retail tax in an amount determined under subsection (d). A bulk
plant is not considered to be a retail outlet.
(d) The amount of tax that must be prepaid under this section
equals:
(1) the prepayment rate per gallon of gasoline; multiplied by
(2) the number of invoiced gallons purchased or shipped.
(e) A purchaser or receiver of gasoline that makes a prepayment
under this chapter is not subject to any liability to the state for the
amount of the prepayment.
As added by P.L.94-1987, SEC.6.
IC 6-2.5-7-10
Remitting tax receipts; reports
Sec. 10. (a) Each refiner or terminal operator and each qualified
distributor that has received a prepayment of the state gross retail tax
under this chapter shall remit the tax received to the department
semimonthly, through the department's online tax filing system,
according to the following schedule:
(1) On or before the tenth day of each month for prepayments
received after the fifteenth day and before the end of the
preceding month.
(2) On or before the twenty-fifth day of each month for
prepayments received after the end of the preceding month and
before the sixteenth day of the month in which the prepayments
are made.
(b) Before the end of each month, each refiner or terminal
operator and each qualified distributor shall file a report covering the
prepaid taxes received and the gallons of gasoline sold or shipped
during the preceding month. The report must include the following:
(1) The number of gallons of gasoline sold or shipped during
the preceding month, identifying each purchaser or receiver as
required by the department.
(2) The amount of tax prepaid by each purchaser or receiver.
(3) Any other information reasonably required by the
department.
As added by P.L.94-1987, SEC.7. Amended by P.L.182-2009(ss),
SEC.181.
IC 6-2.5-7-11
Reports of distributors
Sec. 11. Each distributor that prepays the state gross retail tax
under this chapter shall file a monthly report with the department.
The report shall be filed no later than the last day of the month
following the month that the report covers. The report must include
the following:
(1) The number of gallons of gasoline purchased or received by
the distributor from each refiner, terminal operator, or another
distributor.
(2) The amount of state gross retail tax prepaid to each refiner,
terminal operator, or distributor.
(3) The number of gallons of gasoline sold to each distributor,
retail merchant, exempt purchaser, or other person and the
amount of state gross retail tax collected from each distributor,
retail merchant, or other person identifying the location of each
distributor, retail merchant, exempt purchaser, or other person,
as required by the department.
(4) Any other information reasonably required by the
department.
As added by P.L.94-1987, SEC.8.
IC 6-2.5-7-12
Exempt purchasers from distributor; report; refund
Sec. 12. (a) Except as provided in subsection (b), a distributor that
prepays the state gross retail tax under this chapter shall separately
state the amount of tax prepaid on the invoice the distributor issues
to its purchaser or recipient. The purchaser or recipient shall pay to
the distributor an amount equal to the prepaid tax.
(b) A distributor that:
(1) prepays the state gross retail tax under this chapter;
(2) is a retail merchant; and
(3) sells gasoline that is exempt from the gross retail tax, as
evidenced by a purchaser's exemption certificate issued by the
department;
may not require the exempt purchaser to pay the gross retail taxes
prepaid in the gasoline sold to the exempt purchaser. A distributor
that has prepaid gross retail taxes and has not been reimbursed
because the gasoline is sold to an exempt purchaser may file a claim
for a refund (in addition to any claim for a refund under section 6 of
this chapter), if the amount of unreimbursed prepaid gross retail
taxes exceeds five hundred dollars ($500). A claim for a refund must
be on the form approved by the department and include all
supporting documentation reasonably required by the department. If
a distributor files a completed refund claim form that includes all
supporting documentation, the department shall authorize the auditor
of state to issue a warrant for the refund.
As added by P.L.94-1987, SEC.9.
IC 6-2.5-7-13
Foreign distributor or distribution; reports and payments
Sec. 13. (a) If a purchase or shipment of gasoline is made to a
distributor (other than a qualified distributor) outside Indiana for
shipment into and subsequent sale or use by the distributor within
Indiana, the distributor shall make the prepayment required by
section 9 of this chapter directly to the department. The distributor
shall pay the tax and submit the report according to the schedule set
forth in section 10 of this chapter.
(b) If a purchase or shipment is made within Indiana for shipment
and subsequent sale outside Indiana, the purchase or shipment is
exempt from the prepayment requirements of section 9 of this
chapter.
As added by P.L.94-1987, SEC.10.
IC 6-2.5-7-14
Prepayment rate schedule
Sec. 14. (a) Before June 10 and December 10 of each year, the
department shall determine and provide to:
(1) each refiner and terminal operator and each qualified
distributor known to the department to be required to collect
prepayments of the state gross retail tax under this chapter; and
(2) any other person that makes a request;
a notice of the prepayment rate to be used during the following six
(6) month period. The department, after approval by the office of
management and budget, may determine a new prepayment rate if the
department finds that the statewide average retail price per gallon of
gasoline, excluding the Indiana and federal gasoline taxes and the
Indiana gross retail tax, has changed by at least twenty-five percent
(25%) since the most recent determination.
(b) In determining the prepayment rate under this section, the
department shall use the most recent retail price of gasoline available
to the department.
(c) The prepayment rate per gallon of gasoline determined by the
department under this section is the amount per gallon of gasoline
determined under STEP FOUR of the following formula:
STEP ONE: Determine the statewide average retail price per
gallon of gasoline, excluding the Indiana and federal gasoline
taxes and the Indiana gross retail tax.
STEP TWO: Determine the product of the following:
(A) The STEP ONE amount.
(B) The Indiana gross retail tax rate.
(C) Eighty percent (80%).
STEP THREE: Determine the lesser of:
(A) the STEP TWO result; or
(B) the product of:
(i) the prepayment rate in effect on the day immediately
preceding the day on which the prepayment rate is
redetermined under this section; multiplied by
(ii) one hundred twenty-five percent (125%).
STEP FOUR: Round the STEP THREE result to the nearest
one-tenth of one cent ($0.001).
As added by P.L.94-1987, SEC.11. Amended by P.L.176-2006,
SEC.2; P.L.182-2009(ss), SEC.182.
IC 6-2.5-7-15
Penalties
Sec. 15. (a) A refiner, terminal operator, or distributor (including
a qualified distributor) that fails to remit the tax or file the returns or
reports required by this chapter is subject to the penalties set forth in
IC 6-8.1-10.
(b) A distributor that fails to file the reports required by section
11 of this chapter is subject to the penalties set forth in IC 6-8.1-10.
As added by P.L.94-1987, SEC.12.