Fuels Tax Discounts
Discounts are amounts that may be deducted from tax payments. Persons who hold Virginia fuels tax licenses and who file their returns and pay their fuels tax on time may receive a discount on the taxes.
In addition to the discounts, suppliers may receive credit for uncollected taxes from licensed distributors and importers.
What are the discounts?
- Percentage Discount:
Suppliers who sell fuel from the terminal rack may take a discount of .005 percent from their tax payments for motor fuel sold directly to users and unlicensed distributors.
- Administrative Discount:
Suppliers and alternative fuel providers who file returns with payments timely may take a .001 percent discount on their payments. This discount cannot exceed $5,000 per month.
- One-percent Discount:
A licensed distributor who purchases fuel at the terminal rack and pays to the supplier the tax due by the date the supplier is required to remit the tax to the Commonwealth may take this discount on the amount of taxes paid to their suppliers. Licensed importers who receive motor fuel from a permissive or an elective supplier at the terminal rack may also take this discount.
When are discounts not allowed?
Discounts are not allowed when:
- Transactions are below the rack, or
- A supplier sells tax paid fuel which they received a discount on when they purchased the fuel, or
- A supplier fails to file their return and pay the tax on time to DMV, or
- A licensed distributor or importer fails to pay the tax on time to the supplier, or
- A provider of alternative fuel fails to pay the tax on time to DMV , or
- A licensed retailer or bulk user of alternative fuel who chooses to defer the tax payments fails to pay on time to the alternative fuel provider.