Trying to understand indiana fuel tax rate need help?

So what exactly does it mean that the $0.11 is non refundable. Since it's not paid at the pump, and is assessed later wouldn't it just be calculated at that rate for gallons burned in IN at tax time?

 

You're correct.

The .11 surcharge isn't refundable because you're not paying it until tax time - and more importantly - you're only paying it for gallons actually owed to IN. You can't get a refund / credit for a tax you never paid to begin with.

Basically, if you overpurchase in IN you "only" get credit for the .16 paid at the pump. But it doesn't matter because you only pay the surtax for the gallons actually due to the state.

I think what happens is people who don't really understand IFTA buy a bunch of fuel in IN because the sign price is cheaper than neighboring states. Then when tax time comes they get in a tizzy because they owe money.

 

I realize this is an older subject, but it brings up a question I had a few months back when I was running in IN. Where most states diesel prices are on the sign as one price for cash and another price for credit, I saw some in IN that were one price for something (don't remember which) and a lesser price for "exempt". Who qualifies for that "exempt" price?

 

Trucks that are providing public transportation like a commercial carrier with a DOT number are exempt.

 

Here is a link to the Indiana DOR bulletin about sales tax exemptions for special fuels like diesel, in trucks involved in the public transportation of persons or property. This is not an exemption from IFTA taxes.
http://www.in.gov/dor/files/sib15.pdf

 

Indiana fuel taxes are purposely confusing. If you buy the fuel in Indiana you currently pay a 16 cent per gallon tax at the pump. With the IFTA filing you pay an 11 cent surcharge per gallon burned in Indiana for a total of 27 cents per gallon burned in Indiana. You pay the 11 cent surcharge when you file your IFTA for any fuel burned in Indiana. This is not paid at the pump -- it is a surcharge on top of the taxes paid at the pump. This surcharge is regardless of where the fuel is purchased, and it applies to all truck fuel burned in Indiana. You pay 16 cents per gallon at the pump in Indiana into IFTA compared to almost 36 cents per gallon in Illinois so fuel in Indiana would have to be almost 20 cents cheaper at the pump to be the same cost to the carrier. If fuel costs at the pump were the same in both states, it would save the most money to buy fuel in Illinois where taxes are higher to run in Indiana where the per gallon taxes are 9 cents less after the surcharge.

 

What you have to do is look at the fuel price less taxes and buy it in that area. The taxes are the same no matter
where you buy. Indiana just puts an unfair burden on trucks where all fuels should bear the expense.
But truck owners like being screwed so they'll always be the ones paying.

 

Or here's a thought. Don't fuel in Indiana.

 

Here's a better thought. Factor out the state's fuel tax and buy the least expensive fuel you can find, no matter what state it's in...