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New York: Prepaid Sales Tax on Fuel


 The rates described below do not apply to retail sales.

The New York State Department of Taxation and Finance has announced the creation of new prepaid sales tax regions and a change in New York sales tax prepayment rates on motor fuel. Both changes take effect June 1, 2014.

New York’s prepaid sales tax regions are as follows:

New Region 1

  • New York City, including Bronx, Kings (Brooklyn), New York (Manhattan), Richmond (Staten Island) and Queens counties
  • Dutchess County
  • Orange County
  • Putnam County
  • Rockland County
  • Westchester County

New Region 2

  • Nassau County
  • Suffolk County

New Region 3

  • All other counties in New York State

Formerly, Region 1 consisted of New York City and Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester. And Region 2 consisted of the remaining counties in New York State.

New rates

According to the Chart for Prepayment of Sales Tax on Diesel Motor Fuel, the following rates are to be used effective June 1, 2014:

  • Region 1: $0.1750
  • Region 2: $0.210
  • Region 3: $0.160

The amounts above are sales tax prepayment per gallon. These rates are not to be used to compute tax on a retail sale. Additional information is available on Publication 787.

New rates for each region should be used “when computing the amount of prepaid sales tax due on all motor fuel imported, caused to be imported, compounded, or produced in New York State beginning June 1, 2014.” The new rates should also be used to calculate any “additional prepaid sales tax due on any inventory held as of the close of business May 31, 2014.”

Precise instructions for computing the additional tax due on inventory are provided in Important Notice 14-6, Distributors of Diesel Motor Fuel Relating to Publication 787. Examples are also provided.

You could get out your calculators, or you could switch to an automated sales tax solution.

photo credit: Bill Selak via photopin cc


Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.