Getting Started with Diesel Fuel and Motor Vehicle Fuel Tax

Diesel Fuel

Diesel fuel includes:

• Any liquid that is commonly or commercially known or sold as a fuel that is suitable for use in a diesel-powered highway vehicle. A liquid meets this requirement if, without further processing or blending, the liquid has practical and commercial fitness for use in the engine of a diesel-powered highway vehicle. However, a liquid does not possess this practical and commercial fitness solely by reason of it's possible or rare use as a fuel in the engine of a diesel-powered highway vehicle.
• Renewable diesel.
• Biodiesel.

See the Biofuels page for more information on renewable diesel and biodiesel.

Diesel fuel does not include:

• Gasoline,
• Kerosene,
• Liquefied petroleum gas,
• Natural gas in liquid or gaseous form, or
• Alcohol.

See the Use Fuel Tax Guide for a list of fuels subject to the use fuel tax.

Motor Vehicle Fuel (MVF)

Motor vehicle fuel include:

• Aviation gasoline,
• Gasohol,
• Finished gasoline,
• Gasoline,
• Gasoline blendstocks, and
• Blended motor vehicle fuel.

Gasoline blendstocks includes:

• Alkylate;
• Butane;
• Butene;
• Catalytically cracked gasoline;
• Coker gasoline;
• Ethyl tertiary butyl ether (ETBE);
• Hexane;
• Hydrocrackate;
• Isomerate;
• Light naphtha;
• Methyl tertiary butyl ether (MTBE);
• Mixed xylene (not including any separated isomer of xylene);
• Naphtha;
• Natural gasoline;
• Pentane;
• Pentane mixture;
• Polymer gasoline;
• Raffinate;
• Reformate;
• Straight-run gasoline;
• Straight-run naphtha;
• Tertiary amyl methyl ether (TAME);
• Tertiary butyl alcohol (gasoline grade) (TBA);
• Thermally cracked gasoline;
• Toluene; and
• Transmix containing gasoline.

Motor vehicle fuel does not include:

• Diesel fuel,
• Jet fuel,
• Kerosene,
• Liquefied petroleum gas,
• Natural gas in liquid or gaseous form,
• Racing fuel (leaded and or greater than 100 octane),
• Ethanol (ethyl alcohol),
• Methanol (methyl alcohol), and
• Blends of gasoline and alcohol (including any denaturant) containing 15 percent, or less, gasoline.

Licenses and Accounts Required

Depending on your business activities, you may need to register with us through our online services webpage for a seller's permit, multiple fuel tax licenses, permits, or accounts.

The following tables display the licenses, accounts, and permits for the Diesel Fuel and MVF Tax Programs.

Diesel Fuel and Motor Vehicle Fuel Licenses, Permits, and Accounts

International Fuel Tax Agreement (IFTA) and Interstate User Diesel Fuel Tax

California fuel tax licensing requirements vary depending on where you travel and which fuel you use to power your vehicles. See the IFTA and Interstate User Diesel Fuel Tax Guide for more information.

Supplier License (Diesel Fuel & Motor Vehicle Fuel)

A separate license is needed for diesel fuel & MVF transactions. A diesel fuel supplier must also report all aircraft jet fuel transactions on its Supplier of Diesel Fuel Tax Return. For more information, see the Diesel Fuel & Motor Vehicle Fuel Supplier page.

Terminal Operator License

A Terminal Operator License is required for each terminal location, but only one license is required per location regardless of the types of fuel products stored. If you are a position holder or would otherwise be considered a supplier then, you are required to obtain a supplier license. For more information, please see the Diesel Fuel & Motor Vehicle Fuel Supplier page.

Government Entity Diesel Fuel Tax License

Each diesel fuel government entity operating a diesel-powered highway vehicle upon California highways is required to hold a Government Entity Diesel Fuel Tax License, unless:

• All diesel fuel is purchased tax-paid from a supplier or retail vendor, and
• The tax-paid fuel is used solely to operate a diesel-powered highway vehicle within California.

For more information, please see the Exempt Bus Operator & Government Entity page.

Exempt Bus Operator Diesel Fuel Tax License

We will issue a license only to a person who is a diesel fuel exempt bus operator as defined in Revenue and Taxation Code section 60040. You will need to provide your Public Utilities Commission Number and vehicle information (year, make, vehicle identification number [VIN]) when completing your online application with us. For more information, please see the Exempt Bus Operator & Government Entity page.

Petroleum Common Carrier (Vessel, Pipeline and Train Operator License)

Vessel operators, pipeline operators, and train operators that transport motor vehicle fuel, alcohol, aircraft jet fuel, or diesel fuel into, out of, or within California must obtain a license from us. One license covers all fuel types.

Petroleum Train Operator Permit

You must obtain a Petroleum Train Operator Permit from us before you can use an exemption certificate, CDTFA-231-PT, Fuel Tax Exemption Certificate for Diesel Fuel and Motor Vehicle Fuel Train Operators, for your purchases of fuel used in a train powered by diesel or motor vehicle fuel, or for other tax-exempt use.

Ultimate Vendor Diesel Fuel Tax License

A person that is an ultimate vendor of diesel fuel must obtain an ultimate vendor diesel fuel tax license. If you are a diesel fuel supplier with ultimate vendor activities, your Diesel Fuel Supplier License will cover your ultimate vendor activities. For more information, please see the Ultimate Vendor page.

Diesel Fuel Exempt User Account

If you pay tax on diesel fuel and use it in a nontaxable manner, you may register to file claims for refund with us. For more information, please see the Refund Claims page.

Diesel Fuel Exempt Seller Account

If you export or sell tax-paid diesel fuel to exempt customers (U.S. government, train operators, and others) and are not a licensed ultimate vendor or supplier of diesel fuel, you are an exempt seller. For more information, please see the Refund Claims page.

Petroleum Industrial User License

Petroleum Industrial User includes any person that receives gasoline blendstocks by bulk transfer for its own use in the manufacture of any product other than finished gasoline. A license is required to issue an exemption certificate for purchases of gasoline blendstocks which will not be used to produce finished gasoline.

More Than One Type of License May Be Required

You may need a seller's permit and multiple fuel licenses.

For example:

• If you are a supplier of both diesel fuel and MVF, you will need supplier licenses for both diesel fuel and MVF and may need a seller's permit.
• If you are a terminal operator and a position holder of both diesel fuel and MVF, in addition to a diesel fuel supplier license, MVF supplier license and a terminal operator license, you may need a seller's permit.

Tax Rates

Annually on July 1, the excise tax rates for diesel fuel and MVF are adjusted based on the change in the California Consumer Price Index. The IFTA and interstate user diesel fuel tax component b rate is also adjusted.

Visit our Tax Rates — Special Taxes and Fees webpage to view current and historical fuel tax rates. The current and historical diesel fuel, MVF, and aircraft jet fuel excise tax, sales tax, and prepayment of sales tax rates are available on our website under Sales Tax Rates for Fuels.

Tax Returns, Reports, and Schedule Filings

All applicable motor vehicle fuel and diesel fuel tax returns, reports, and schedules (filings) can be filed online. A filing must be made even if no transactions occurred during the reporting period. Filings are due on the last day of the month following the reporting period. You may be required to file other returns or reports with us.

For most diesel fuel and MVF tax forms, we have adopted standardized forms, schedules, mode codes, and product codes as published by the Federation of Tax Administrator's Motor Fuel Tax Section. All required data must be presented in the format we specify. For additional filing resources, please see:

• Motor Fuels Online Filing webpage—For online filing information relating to filing via Electronic Data Interchange (EDI) or Flat (FLT) file (for other than diesel fuel exempt bus operator, IFTA, and interstate user diesel fuel tax)
• CDTFA-810-FTE, Instructions for Preparing Motor Fuel Schedules, for more information on specific schedules, including schedule codes for specific types of transactions.

Suppliers, ultimate vendors, exempt users, and exempt sellers use the following generic schedule templates to report their detailed transactions to support their filings.

• CDTFA-810-FTG, Receipt Schedule
• CDTFA-810-FTF, Disbursement Schedule

Listed below are the applicable tax returns and reports required by each filer type.

1. Vessel, barge, and pipeline operators must report every gallon of fuel product received or delivered to California terminals or refineries. Train operators must report all movements of fuel products that originate and/or terminate in California.
2. Train operators must report all exempt purchases of undyed diesel fuel, dyed diesel fuel and motor vehicle fuel for use in their exempt petroleum train operations in California.