To follow-up RogerB's psot, many locations (gas stations) sell what's known as "red diesel" or "colored diesel" (and it's been discussed in other Gas Buddy discussion threads) at prices that are exempt from state fuel taxes (or have considerably reduced taxes). Some stations list the "exempt" price on their "drive-by price signs" just as they might list propane or kerosene in addition to E-85 and/or ethanol-free fuel.
Message Posted: Oct 21, 2013 2:49:20 PM
The price you should be listing on Gas Buddy is the price that the average driver pulling into a gas station will pay, without any discounts (needing to buy a car wash; being a member of a club, etc. The exception is for warehouse clubs such as Costco, BJ's and Sam's Club, which charge a membership to join the club, but for which there are no other gas price discounts; everyone pays the same at the pump if you're a member of Costco, etc.)
For some background on "the tax-exempt price" referred to in the original post, there's two parts to the story:
First, the most generally understood:
Not all diesel fuels have the same destination. Home heating oil, for example, is designated to be pumped into above-ground storage tanks and used as a source of heat. The diesel fuel in a home heating unit is atomized and then ignited to provide warmth. Diesel fuel for automobiles contains more sulfur than home heating oil, and is designed strictly for use in diesel engines. Automotive diesel fuel is also subject to taxes not levied on home heating oil. In order to tell the two fuels apart, a special red dye is added to home heating oil to create red diesel.
Red diesel fuel is only slightly different chemically from regular automotive diesel fuel, but there can be a significant difference in cost. The cheaper red diesel fuel could conceivably work in place of the more expensive automotive diesel fuel, but that would defeat the purpose of a fuel tax. In order to ensure that home heating oil, which is minimally taxed, is not used as diesel fuel, which can be heavily taxed, revenue agents require home heating oil to receive a special red dye. This liquid red dye can be detected in even the smallest samples taken for examination.
Using red diesel for reasons other than home heating is generally considered a criminal act, since the buyer did not pay the proper tax for regular diesel fuel. If there is reasonable cause to inspect a vehicle's fuel tank or storage tank, inspectors can quickly and conclusively identify the presence of red diesel and take appropriate action against the offender. Without the creation of red diesel, it would take a trained chemist to differentiate between home heating oil and automotive diesel fuel.
That's the easy answer.
The more complicated story goes back to January 1, 1994 the effective date that the U.S. government required that diesel fuel be sold in three colors (clear, red, and blue as part of an effort by two Federal agencies and Congress to clean the air and collect fuel taxes. For the Government, it was simple; for everyone else, it was less simple (if not confusing). In simple terms, it was almost everyone used clear diesel, low sulfur red diesel was largely for tax-exempt highway use, and high sulfur blue diesel was for uses off the road)
At that time the law required that highway vehicles must burn expensive clear diesel, except for government cars and trucks, local buses and vehicles owned by disparate groups like aircraft museums, nonprofit schools and the American Red Cross. They may run on cheap diesel that is dyed red, but not blue diesel, which is even cheaper.
Farmers, however, could buy blue diesel for their tractors and generators, but must buy clear if their pickups use diesel. Truckers must run their rigs on low-polluting clear, but can fill their refrigerated trailer units with less expensive but more polluting blue (if they could find it). Pleasure boaters had to fill their diesel motors with clear, but charter boats could use blue.
Home and apartment-building furnaces that run on diesel fuel oil could burn either red or blue but not both at once. Making purple of the two is illegal under Federal law.
The types of fuel are classified by the type of use, amount of sulfur emissions and tax category. Clear diesel, having low sulfur and carrying the full tax, was for highway users and was the most expensive. Blue diesel, which is higher in sulfur and tax exempt, was for use in commercial boats, trains or some farm equipment; it was the least expensive. Falling in between was red diesel, which was lower in sulfur than blue, tax free and meant for buses, government vehicles and off-road use.
That was nothing to be trifled with as Federal agents were authorized to check almost any storage tank or pump to insure that the diesel in it is chromatically correct. Resisting an inspection can result in a fine.
There's more to the story but, for simplicity's sake, that's the story.
There are/were other concerns such as inadvertent mixing of fuels or delivery of the wrong dyed fuel to a station (and the subsequent requirement for the dealer to sell the mixed fuel at the lowest price, but still be required to pay the higher fuel tax rate that the underground tank would normally hold. And there's the issue of gas stations needing to either install new tanks and pumps for dyed fuels, or refrain from selling them. Because underground tanks are costly to install and even costlier to insure, many dealers dropped some types of diesel.
For your "humor", consider this:
"Farmers are tax exempt except when they drive on roads. The American Red Cross can buy diesel tax free, but the Salvation Army cannot.
And, for background, the Internal Revenue Service says that the United States is among the last industrialized nations to dye its fuel and that the system has worked well almost everywhere else it has been tried.
The above has nothing to do with the original question, other than background. THE BOTTOM LINE IS that when you're posting prices on Gas Buddy, the price you should be posting is the price with the "full tax rate."
Many people won't understand this question, because Indiana is one of only 2 states which allow stations to sell fuel tax free to trucks that are tax exempt (most commercial trucks are). Some Truck Stops here take advantage of this, and charge a much higher price to non-exempt vehicles. At some stations, the Auto Diesel price is 25 - 30 cents higher, even though the are only about 18 cents. They have found that many drivers, especially those from out of state, are misled and pull in and fill up without checking the price on the pump. This is especially painful for out of state RV drivers who are initially unaware of this unique situation.
Message Posted: Oct 21, 2013 12:14:55 AM
Many members incorrectly post the exempt price on the sign. At some stations the only place to find the Auto Diesel price is at the pump. Please post the correct price, and correct the incorrect prices posted by others.