The Vermont Statutes Online

Title 23: Motor Vehicles

Chapter 027: Diesel Fuel Tax

• § 3000. Statutory purposes

  The statutory purpose of the exemption for diesel tax in section 3003 of this title is to relieve off-road uses and farm truck uses from the user fee for the State highway system. (Added 2013, No. 200 (Adj. Sess.), § 19.)

• § 3001. Purpose

  The purpose of this chapter is to impose a tax on all users of diesel fuel upon the sale or use of such fuel by motor vehicles on public highways. (Added 1981, No. 172 (Adj. Sess.), § 1.)

• § 3002. Definitions

  As used in this chapter:

  (1) “Commissioner” means the Commissioner of Motor Vehicles or any officer or employee of the Department duly authorized by him or her to perform the functions mentioned or described in this chapter.

  (2) “Dealer” means any person who sells or delivers fuel into the fuel supply tanks of motor vehicles owned or operated by others.

  (3) “Distributor” means any person who sells or delivers fuel into bulk storage tanks of a dealer or user.

  (4) “Fuel” means clear diesel fuel that has not been dyed in accordance with 26 U.S.C. § 4082 or section 211(I) of the Clean Air Act and any blend of undyed diesel and other fuel used or suitable for use for the generation of power to propel motor vehicles.

  (5) “Motor vehicle” means any self-propelled vehicle using fuel on the public highways and registered or required to be registered for operation thereon.

  (6) “Motor bus” means any motor vehicle with a seating capacity of more than 20 persons.

  (7) “Motor truck” means a motor vehicle designed primarily for the transportation of property and goods and not primarily for the transportation of passengers.

  (8) “Railroad fuel” means diesel fuel and any blend of diesel and other fuel used or suitable for use for the generation of power to propel a railroad train.

  (9) “Use” means the consumption of fuel by a user to propel motor vehicles on the highways of the State.

  (10) “User” means any person who uses fuel to propel a motor vehicle, owned or operated by him or her, upon the highways of this State. The term shall also include a lessor rental or leasing company when the lessor leases motor vehicles without drivers to a lessee under a contract where cost of fuel is included in lease payments and the lessor purchases fuel and maintains records of fuel used and miles traveled by such leased vehicles. In all other cases, upon application by either the lessor or lessee, the Commissioner will determine and approve the reporting and tax payment procedure to be used; provided, however, that the lessor and lessee shall be jointly and severally liable for the payment of the tax in any event.

  (11) “Mail,” “mails,” “mailing,” and “mailed” mean any method of delivery authorized by the Commissioner, which shall include by hand, U.S. mail, and electronic transmission. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1987, No. 98, § 4, eff. March 1, 1988; 1999, No. 154 (Adj. Sess.), § 1; 2015, No. 47, § 44; 2017, No. 132 (Adj. Sess.), § 16; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3003. Imposition of tax; exceptions

  (a) A tax of $0.28, a fee of $0.01 established pursuant to the provisions of 10 V.S.A. § 1942, and a $0.03 motor fuel transportation infrastructure assessment, which for purposes of the International Fuel Tax Agreement only shall be deemed to be a surcharge, are imposed on each gallon of fuel:

  (1) sold or delivered by a distributor; or

  (2) used by a user.

  (b) Collection of the tax and its payment to the State shall be as follows:

  (1) The distributor shall collect the tax from a dealer or user on delivery of fuel into the dealer’s or user’s bulk tanks. The tax shall attach at the time of delivery into the bulk tank. When a distributor collects a tax from a dealer or user, the distributor shall pay the same to the Commissioner with the monthly report required by section 3014 of this title.

  (2) A user who uses fuel shall pay the tax to the Commissioner as provided in section 3015 of this title. The tax shall attach at the time of the consumption of such fuel in the propulsion of a motor vehicle upon the highways of the State.

  (c) A tax of three cents per gallon is imposed on each gallon of railroad fuel used in the State.

  (d)(1) For users, the following uses shall be exempt from the tax and motor fuel transportation infrastructure assessment imposed under this chapter and be entitled to a credit for any tax paid for such uses under section 3020 of this title:

  (A) uses, the taxation of which would be precluded by the laws and Constitution of the United States and this State;

  (B) uses for agricultural purposes not conducted on the highways of the State;

  (C) uses by any State, municipal, school district, fire district, or other governmentally owned vehicles for official purposes;

  (D) uses by any vehicle off the highways of the State; and

  (E) uses by any vehicle registered as a farm truck under subsection 367(f) of this title.

  (2) Provided, however, that no tax shall be due with respect to fuel for use in any State, municipal, school district, fire district, nonprofit public transit system as defined in 24 V.S.A. § 5088(3), or other vehicle owned, leased, or contracted for other than single-trip use by a government entity, as long as the distributor takes from the purchaser at the time of sale an exemption certificate in the form prescribed by the Commissioner; and provided, further, that no tax shall be due with respect to fuel delivered for farm use to a farm bulk fuel storage tank.

  (e) A distributor may use as the measure of the tax so levied and assessed the gross quantity of diesel fuel purchased, imported, produced, refined, manufactured, and compounded by the distributor, instead of the quantity sold, distributed, or used. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 107 (Adj. Sess.) eff. Feb. 29, 1984; 1985, No. 147 (Adj. Sess.), § 1; 1987, No. 282 (Adj. Sess.), § 6, eff. April 1, 1989; 1989, No. 51, § 2, eff. June 1, 1989; 1993, No. 65, § 1; 1999, No. 154 (Adj. Sess.), § 2; 2009, No. 50, §§ 22, 23, eff. Oct. 1, 2009; § 77, eff. July 1, 2010; 2013, No. 12, § 21; 2013, No. 12, § 22, eff. July 1, 2014; 2015, No. 159 (Adj. Sess.), § 1, eff. June 1, 2016; 2015, No. 159 (Adj. Sess.), § 1a, eff. June 1, 2017.)

• § 3004. Repealed. 1999, No. 154 (Adj. Sess.), § 11.

• § 3005. Dealer’s and distributor’s licenses; application; issuance

  (a) It is unlawful for any person to act as a distributor or dealer without being licensed as such.

  (b) An applicant for a dealer’s or distributor’s license shall file by mail an application furnished by the Commissioner with the Commissioner. The application shall not be under oath but shall contain a declaration that it is made under the penalties of perjury.

  (c) When a licensee acts in a capacity other than that for which his or her license has been issued, he or she shall apply for additional licenses in accordance with this section.

  (d) Upon the receipt of an application in proper form and the other conditions and requirements of this chapter having been complied with, the Commissioner may issue a license to an applicant that will remain in effect until such time as surrendered or revoked. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 58, §§ 1, 2; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3006. Display of licenses and identification markers

  Distributors and dealers shall conspicuously display their licenses in their established place of business or location in this State. (Added 1981, No. 172 (Adj. Sess.), § 1.)

• § 3007. Diesel fuel user’s license

  (a) In addition to any other provision of law relating to registration of motor vehicles, or fees paid for the registration of motor vehicles, a person owning or operating upon the highways of the State a motor truck that is registered in the State and uses fuel as defined in section 3002 of this title shall, for each motor truck to be so operated, apply to the Commissioner for a diesel fuel user’s license, which shall be renewed at the time of renewal of the truck’s registration. Application shall be made upon a form prescribed by the Commissioner and shall set forth the information as the Commissioner may require. Applications filed at the time of the initial registration or renewal of a registration shall be accompanied by a $6.50 annual license fee for each motor truck listed in the application, except that no fee shall be required for motor trucks with a gross weight of less than 26,001 pounds.

  (b) [Repealed.]

  (c) This section shall not apply to users’ vehicles exempt from reporting requirements under section 3014 of this title or to users’ vehicles exempt from taxation under subdivision 3003(d)(1)(C) of this title or to users’ vehicles that are being operated under the provisions of section 463 or 516 of this title. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 58, § 9; 1985, No. 124 (Adj. Sess.), § 11, eff. April 18, 1986; 1987, No. 98, § 5, eff. March 1, 1988; 1987, No. 109, § 2; 1987, No. 283 (Adj. Sess.), § 2; 1989, No. 46, § 2, eff. May 5, 1989; 1989, No. 51, § 47; 1989, No. 51, § 47a, eff. July 1, 1990; 1991, No. 137 (Adj. Sess.), § 2; 1993, No. 186 (Adj. Sess.), § 9; 1993, No. 212 (Adj. Sess.), § 10; 1999, No. 154 (Adj. Sess.), § 3; 2013, No. 189 (Adj. Sess.), § 16; 2023, No. 85 (Adj. Sess.), § 305, eff. July 1, 2024.)

• § 3008. Refusal to issue license

  (a) The Commissioner may refuse to issue a license after a finding that the application:

  (1) is filed by a person whose license has been revoked previously by the Commissioner;

  (2) contains any misrepresentation, misstatement, or omission of material information required by the application;

  (3) is filed by a person as a subterfuge for the real person in interest whose license has been revoked by the Commissioner; or

  (4) is filed by a person who is delinquent in the payment of any tax, interest, penalty, or other expense due the Commissioner by him or her.

  (b) Such findings may be made by the Commissioner after a hearing held not less than 15 days after mailing notice thereof to the applicant, at which the applicant shall have the right to appear in person or by counsel and to present evidence. (Added 1981, No. 172 (Adj. Sess.), § 1.)

• § 3009. Discontinuance, revocation, and reinstatement of licenses

  (a) When any person ceases to be a licensee by reason of a discontinuance, sale, or transfer of his or her business at any location, he or she shall notify the Commissioner in writing by mail at the time the discontinuance, sale, or transfer takes effect. The notice shall give the date of discontinuance and, in the event of a sale or transfer of the business, the name and address of the purchaser or transferee. All taxes, interest, and penalties not yet due and payable under the provisions of this chapter shall be due and payable, notwithstanding such provisions, concurrently with the discontinuance, sale, or transfer. The licensee shall file a report by mail and simultaneously pay all taxes, interest, penalties, and other expenses due by him or her and surrender to the Commissioner the license certificate issued to him or her together with all duplicates and copies, and a user shall remove and surrender to the Commissioner all identification markers from his or her motor vehicles. Until such notice has been given to the Commissioner by a licensee required to file a bond, the seller and his or her surety shall be liable for the taxes, interest, penalties, and other expenses accruing against the transferee, but only to the extent of the value of the property transferred.

  (b) The Commissioner may suspend or revoke the license, the right to operate any vehicle, and any registrations of a person who fails to comply with any provision of this chapter or any rule adopted pursuant to this chapter. Such suspension or revocation shall be effective upon not less than 15 days’ notice unless within those 15 days the licensee mails a written request for a hearing to show cause why the suspension or revocation should not become effective.

  (c) The Commissioner may reinstate a suspended license or issue a new license at any time upon satisfaction by the licensee of the delinquency for which such license was revoked. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 9, eff. April 21, 1983; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3010. Temporary authorization

  Any vehicle registered in a jurisdiction other than Vermont that is eligible for motor fuel tax licensing under the International Fuel Tax Agreement Plan and that is not licensed in Vermont for fuel tax reporting purposes may obtain a trip permit prior to entering this State. The fee for the permit shall be $15.00. The permits shall be valid for a period of 72 hours and shall satisfy motor fuel tax reporting and payment obligations that may arise from the trip. Trip permits must be kept with the vehicle while being operated. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 124 (Adj. Sess.), § 12, eff. April 18, 1986; 1997, No. 55, § 8, eff. June 26, 1997; 1997, No. 59, § 78, eff. June 30, 1997; 2021, No. 20, § 249.)

• § 3011. Bond requirement; amount; failure of security

  (a) When the Commissioner deems it necessary to protect the revenues to be obtained under this chapter, he or she may require a user, dealer, or distributor to file with him or her a bond, issued by a surety company authorized to transact business in this State and approved by the Commissioner of Financial Regulation of this State as to solvency and responsibility, in an amount fixed by the Commissioner, but not to exceed the total potential liability of such person, to secure the payment of any tax or penalties or interest due or that may become due from a licensee under this chapter. In the event that the Commissioner determines that such person is to file a bond, he or she shall notify the user, dealer, or distributor by mail of the amount of the bond required. That person shall file a bond within 15 days after the giving of the notice unless within those 15 days he or she shall request in writing sent by mail a hearing before the Commissioner at which the necessity, propriety, and amount of the bond shall be determined by the Commissioner. The Commissioner’s determination shall be final and shall be complied with within 15 days after mailing to the user, dealer, or distributor. In lieu of a bond, securities approved by the Commissioner or cash in such amount as he or she may prescribe may be deposited, which shall be kept in the custody of the State Treasurer who may at any time upon instructions from the Commissioner without notice to the depositor apply them to any tax or interest or penalties due, and for that purpose the securities may be sold by him or her at public or private sale without notice to the depositor thereof.

  (b) The total amount of the bond required of a licensee may be fixed by the Commissioner and may be increased or decreased by him or her at any time subject to the limitations imposed by this section.

  (c) If the liability upon a bond filed by a licensee with the Commissioner becomes discharged or reduced, whether by judgment rendered, payment made, or otherwise, or if in the opinion of the Commissioner any surety on a bond has become unsatisfactory or unacceptable, the Commissioner shall require the licensee to file a new bond with satisfactory sureties in the same amount and, upon failure to do so, the Commissioner shall immediately revoke the license.

  (d) If a licensee fails or refuses to increase the amount of a bond or file a bond as required by the Commissioner within 15 days after notice is mailed to the licensee, then the licensee’s license shall be revoked immediately. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1989, No. 225 (Adj. Sess.), § 25; 1995, No. 180 (Adj. Sess.), § 38; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020; 2023, No. 85 (Adj. Sess.), § 306, eff. July 1, 2024.)

• § 3012. Discharge of surety

  Any surety on a bond furnished by a licensee shall be discharged from any liability to the State accruing on the bond after expiration of 60 days from the date the surety filed by mail with the Commissioner a written request to be released and discharged, but the surety shall not be released or discharged from liability already accrued or that shall accrue before the expiration of the 60-day period. The Commissioner, upon receipt of such a request, shall promptly notify by mail the licensee who furnished the bond. Unless the licensee, prior to the expiration of the 60-day period, files a new bond satisfactory to the Commissioner, the Commissioner shall revoke his or her license. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3013. Records; sales invoice; inspection

  (a) Each licensed user under this chapter shall keep and retain for a period of not less than three years such records as may be prescribed by the Commissioner that are reasonably necessary to substantiate the reports required by section 3014 of this title.

  (b) Each sale or delivery of fuel by a dealer to a user shall be recorded on demand by the user upon a preprinted, serially numbered invoice approved in form and content by the Commissioner and delivered to the user by mail. The sales invoice shall constitute a receipt for the amount of tax collected by the dealer upon payment by the user. Copies of the sales invoices shall be retained by the user and the dealer for not less than three years. For the purposes of claiming a tax credit or refund under sections 3015 and 3020 of this title, a user with the approval of the Commissioner may submit as a receipt a record of purchases made upon which the tax was paid at the time of purchase; provided, however, that the supporting documents are available for audit purposes in readily accessible form or on readable microfilm.

  (c) The Commissioner or the Commissioner’s agents may examine the books and records of any distributor, dealer, or user during the usual business hours of the day to verify the truth and accuracy of any statement, report, or return or to determine if the tax imposed by this chapter has been paid. If the books and records of a nonresident licensee are not available for examination in this State, the Commissioner may request that the nonresident licensee furnish at the Commissioner’s office in Montpelier the books and records the Commissioner reasonably requires. If the licensee shall be unable or unwilling to comply with the request, the Commissioner is authorized to charge the licensee a reasonable per diem fee and expenses for the auditor making the examination out of state, which shall be payable within 30 days after the mailing of a bill by the Commissioner.

  (d) The Commissioner may enter into agreements with officials of other states, the District of Columbia, and Canadian provinces for the cooperative examination of licensee reports, returns, books, and records, and for the collection of fees and penalties. In performing such duties, officials of other states, the District of Columbia, and Canadian provinces shall be deemed authorized agents of the Commissioner for such purposes. The Commissioner may provide information about the receipt, storage, delivery, sale, use, or other disposition of fuel by any licensee to officials in other states, the District of Columbia, and Canadian provinces who administer fuel tax laws, provided such officials may furnish similar information to the Commissioner. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 1, eff. April 21, 1983; 1989, No. 182 (Adj. Sess.), § 4, eff. May 16, 1990; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020; 2023, No. 85 (Adj. Sess.), § 307, eff. July 1, 2024.)

• § 3014. Reports; exceptions

  (a) Every distributor or dealer, on or before the 25th day of each month, shall file by mail with the Commissioner on forms prescribed by him or her a report for the preceding month that shall include the number of gallons of fuel sold or delivered. A distributor’s report shall also include the identity of the person to whom the fuel was sold or delivered, the amount of the tax collected and by whom, and the monthly total of fuel sold or delivered. The report shall be filed even though no fuel was sold or delivered.

  (b) Every licensed user shall file by mail a report with the Commissioner on forms prescribed or in a form approved by him or her that shall include the number of gallons of fuel used in Vermont by motor vehicles owned or operated by him or her. All users shall file on a quarterly basis on or before April 30 for the calendar quarter ending March 31, on or before July 31 for the calendar quarter ending June 30, on or before October 31 for the calendar quarter ending September 30, and on or before January 31 for the calendar quarter ending December 31. The report shall be filed even though no motor fuel was used or delivered.

  (c) Any user whose sole use of fuel is for the propulsion of a pleasure car or motor truck registered for not more than 26,001 pounds is exempt from filing the report.

  (d) If the Commissioner deems it necessary in order to ensure payment of the tax, or to facilitate the administration of this chapter, the Commissioner may require reports and payment of tax to be made for other than and in addition to quarterly periods. A user may apply to the Commissioner for approval to file reports and pay taxes on a more frequent basis.

  (e) The Commissioner may exempt a dealer from the monthly report requirement if the dealer holds a valid license and annually certifies that the dealer purchases all fuel sold or delivered from a licensed distributor and pays the tax on such fuel to the distributor. A dealer so exempted shall retain and make available for inspection by the Commissioner or designated agents such records as may be required to substantiate the certification, including pump meter readings and delivery invoices. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, §§ 2, 3, 6, 8; 1987, No. 98, § 1, eff. Jan. 1, 1988; 1987, No. 111, § 1; 1987, No. 241 (Adj. Sess.), § 6; 1989, No. 84, § 6; 1995, No. 47, § 14, eff. April 20, 1995; 1999, No. 154 (Adj. Sess.), § 4; 2013, No. 189 (Adj. Sess.), § 20; 2019, No. 131 (Adj. Sess.), § 221; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3015. Computation and payment of tax

  Each report required under section 3014 of this title from licensed distributors, dealers, or users shall be accompanied by evidence of an electronic funds transfer payment or a remittance payable to the Department of Motor Vehicles for the amount of tax due, which shall be computed and transmitted in the following manner:

  (1) The distributor’s tax shall be determined by multiplying the number of gallons of fuel sold or delivered into the bulk tanks of dealers or users by the rate per gallon stated in section 3003 of this title.

  (2) Except as provided in subdivision 3002(9) of this title, the user’s tax shall be determined by multiplying the number of gallons of fuels used in Vermont in motor vehicles operated by the user at the rate per gallon stated in section 3003 for vehicles weighing or registered for 26,001 pounds or more. The taxable gallonage shall be computed on the basis of miles traveled within the State as compared to total miles traveled, with the actual method of computation prescribed by the Commissioner. A distributor may use as the measure of the tax so levied and assessed the gross quantity of fuel purchased, imported, produced, refined, manufactured, and compounded by the distributor, instead of the quantity sold, distributed, or used. From this amount of tax due, there shall be deducted the tax on fuel purchased in this State on which the tax has been previously paid by the user, provided the tax-paid purchases are supported by copies of the sales invoices showing the amount of tax paid. Such copies shall be retained by the taxpayer for a period of not less than three years and shall be available for inspection by the Commissioner or his or her designated agents. If the computation shows additional tax to be due, it shall be remitted with the report filed under section 3014 of this title.

  (3)(A) Distributors and dealers filing a report required under subsection 3014(a) of this title shall transmit payment of taxes due to the Department of Motor Vehicles by means of an electronic funds transfer.

  (B) Users filing a report required under subsection 3014(b) of this title shall transmit payment of taxes due to the Department of Motor Vehicles by means of an electronic funds transfer payment or by a remittance through the U.S. mail. If a remittance is sent through the U.S. mail properly addressed to the Department of Motor Vehicles, it shall be deemed received on the date shown by the postmark on the envelope containing the report only for purposes of avoiding penalty and interest. In the event a mailing date is affixed to the envelope by a machine owned or under the control of the person submitting the report and the U.S. Post Office has corrected or changed the date stamped thereon by causing the official U.S. Post Office postmark to also be imprinted on the envelope, the date shown by the official Post Office postmark shall be the accepted date if different from the original postmark.

  (4) All taxes, interest, user license fees, and penalties collected by the Department of Motor Vehicles under this chapter shall be paid immediately to the State Treasurer and credited to the Transportation Fund.

  (5) Notwithstanding subdivision (4) of this section, the one cent per gallon fee imposed by this chapter shall be deposited into the Petroleum Cleanup Fund established by 10 V.S.A. § 1941. These fees shall be deemed the petroleum distributor licensing fee established by 10 V.S.A. § 1942. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 7, eff. April 21, 1983; 1987, No. 111, § 2; 1987, No. 282 (Adj. Sess.), § 18; 1989, No. 51, § 3, eff. April 1, 1989; 1989, No. 51, § 4, eff. April 1, 1990; 1991, No. 165 (Adj. Sess.), § 8; 1999, No. 154 (Adj. Sess.), § 5; 2015, No. 159 (Adj. Sess.), § 2, eff. June 1, 2016; 2015, No. 159 (Adj. Sess.), § 2a, eff. June 1, 2017; 2017, No. 206 (Adj. Sess.), § 9, eff. July 1, 2019; 2017, No. 206 (Adj. Sess.), § 10, eff. July 1, 2020; 2019, No. 131 (Adj. Sess.), § 222; 2023, No. 85 (Adj. Sess.), § 308, eff. July 1, 2024.)

• § 3016. Additional assessment; time limit

  (a) If the Commissioner is not satisfied that the report filed or the amount of tax paid by a taxpayer is accurate, after investigating and finding such inaccuracy, the Commissioner may make an additional assessment of taxes due from the taxpayer based upon the Commissioner’s investigation. In estimating the tax due from a licensed user, fuel consumption shall be computed at the rate of 10 miles per gallon for vehicles registered up to and including 10,000 pounds and at four miles per gallon for all vehicles registered over 10,000 pounds for any unreported Vermont mileage in excess of four percent of the operator’s total Vermont mileage. Any tax assessed for mileage up to four percent of the operator’s total Vermont mileage shall be assessed based on the operator’s fuel consumption average for the operator’s entire fleet. A penalty equal to 10 percent and interest at the rate of one and one-half percent per month shall be payable on the additional assessment, with interest computed from the date the tax payment was due. The Commissioner shall give notice by mail to the taxpayer of the additional assessment, penalty, and interest and shall designate the error or reason for the assessment. Payment shall be due within 30 days after the date of mailing the notice. The Commissioner may, in the Commissioner’s discretion, waive all or any part of the penalty.

  (b) When no report or payment of tax has been made as required by sections 3014 and 3015 of this title, or when a willfully false or fraudulent report has been filed, the tax may be assessed at any time; in all other cases, no assessment of additional tax, and the mailing of notice, shall be made after the expiration of three years from the date of filing a report. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 58, § 3, eff. May 16, 1985; 1987, No. 111, § 3; 1987, No. 241 (Adj. Sess.), § 7; 1999, No. 154 (Adj. Sess.), § 6; 2023, No. 85 (Adj. Sess.), § 309, eff. July 1, 2024.)

• § 3017. Failure to file a report or pay the tax when due; penalty

  (a) Any person who fails to file a report when due shall pay a fee of $10.00 as partial compensation for the added administrative costs.

  (b) In addition to the fee prescribed in subsection (a) of this section, any person who fails to pay any tax when due, except a tax assessed pursuant to sections 3016 and 3018 of this title, shall pay in addition to the tax interest calculated at one and one-half percent per month on the tax from the due date, until paid. In addition, if the taxpayer fails to pay the tax liability in full within 30 days, a penalty equal to five percent of the outstanding tax liability for each month or portion of a month shall be paid; provided, however, that in no event shall the amount of the penalty imposed under this section exceed 25 percent of the tax liability unpaid on the prescribed date of payment. The Commissioner may remit all or any part of the penalty if the Commissioner is satisfied that the delay was excusable. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 2023, No. 85 (Adj. Sess.), § 310, eff. July 1, 2024.)

• § 3018. Neglect or refusal to file a report; estimate of tax by Commissioner; penalty and interest

  If any person neglects or refuses to file any report required by this chapter, the Commissioner shall make an estimate of the tax due, based upon information available to the Commissioner, for the period for which that person failed to make the report and shall assess the tax due from the licensee, adding to the amount thus determined a penalty of 50 percent. In estimating the tax due from a licensed user, fuel consumption shall be computed at the rate of 10 miles per gallon for vehicles registered up to 10,000 pounds and four miles per gallon for those vehicles registered over 10,000 pounds. The assessment shall bear interest at the rate of one and one-half percent per month from the date the tax payment was due until paid. The Commissioner shall give the licensee notice by mail of the assessment and payment shall be due within 15 days after the date of the mailing of the notice. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 58, § 4, eff. May 16, 1985; 1987, No. 111, § 4; 1987, No. 241 (Adj. Sess.), § 8; 2023, No. 85 (Adj. Sess.), § 311, eff. July 1, 2024.)

• § 3019. Assessment; hearing permitted

  Any person against whom assessment is made pursuant to section 3016 or 3018 of this title may appear in person or by counsel in the office of the Commissioner within 15 days after the mailing to him or her of notice of the assessment then and there to show cause why the assessment is in error or to present any other facts or testimony that would bear on the amount of the assessment or the manner in which it was made. The hearing may be continued from time to time. If the person or his or her agent does not appear within the 15 days, the assessment shall become final. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1987, No. 111, § 5.)

• § 3020. Credits and refunds

  (a) Credits.

  (1) A user who purchased fuel within this State from a dealer or distributor upon which he or she paid the tax at the time of purchase, or a user exempt from the payment of the tax under subsection 3003(d) of this title who purchased fuel within this State upon which he or she paid tax at the time of purchase, shall be entitled to a credit equal to the amount of tax per gallon in effect when the fuel was purchased. When the amount of the credit to which any user is entitled for any reporting period exceeds the amount of his or her tax for the same period, the excess shall be credited to the user’s tax account and the user shall be notified of the date and amount of the credit by mail.

  (2) If the Commissioner determines that a tax, penalty, interest, or fee required by this chapter has been paid more than once by a user, or has been illegally or erroneously collected or computed, the excess amount paid or collected shall be credited to the user’s tax account and the user shall be notified of the date and amount of the credit by mail.

  (3) A user who also sells or delivers fuel subject to the tax imposed by 32 V.S.A. chapter 233 upon which the tax imposed by this chapter has been paid shall be entitled to a credit equal to the amount of such tax paid pursuant to this chapter. When the amount of the credit to which any user is entitled for any reporting period exceeds the amount of his or her tax for the same period, the excess shall be credited to the user’s tax account and the user shall be notified of the date and amount of the credit by mail.

  (4) Any credits in the user’s tax account shall be allowed as a credit against either the tax for which the user otherwise would be liable for in a succeeding reporting period or any registration fees assessed pursuant to chapter 35 of this title.

  (b) Refunds. A user may request, in writing by mail, a refund of any credits in the user’s tax account, but in no case may a user collect a refund requested more than 33 months following the date the amount was credited to the user’s tax account.

  (c) [Repealed.] (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 4, eff. April 21, 1983; 1985, No. 58, § 5; 1987, No. 98, § 2, eff. Jan. 1, 1988; 1993, No. 212 (Adj. Sess.), § 11; 1999, No. 154 (Adj. Sess.), § 7; 2019, No. 149 (Adj. Sess.), § 20, eff. July 13, 2020.)

• § 3021. General powers of Commissioner

  (a) The Commissioner shall have the authority to administer and enforce the provisions of this chapter.

  (b) In addition to the powers specifically granted to the Commissioner in this chapter, he or she may:

  (1) Make, amend, and repeal rules under 3 V.S.A. chapter 25 as limited by this chapter and prescribe forms appropriate to the purposes of this chapter.

  (2) Delegate to any officer or employee in his or her Department powers he or she may deem necessary to carry out efficiently the provisions of this chapter, and the person or persons to whom the power has been delegated shall possess and may exercise all of the power and perform all of the duties conferred and imposed upon the Commissioner.

  (3) With the approval of the Governor and Secretary, enter into agreement with other states, the District of Columbia, and Canadian provinces, providing for the reciprocal enforcement of the fuel use tax laws imposed by the states or provinces entering into such an agreement, which agreement may empower the duly authorized officer of any contracting state or province, which extends like authority to officers or employees of this State, to sue for the collection of that state’s or province’s fuel use taxes in the courts of this State. The agreement is allowed to conflict with sections 3007, 3009, and 3014 through 3019 of this title and the agreement shall govern licensees covered by the agreement.

  (4) Hold hearings, cause depositions to be taken, administer oaths, and examine under oath any person relating to his or her business or relating to any matter under this chapter. This chapter shall also apply to any person who the Commissioner has reason to believe is liable for the payment of a tax.

  (5) Compel the attendance of witnesses and order the production of any relevant books, records, papers, vouchers, accounts, or other documents of any person the Commissioner has reason to believe is liable for the payment of a tax or of any person believed to have information pertinent to any matter under investigation by the Commissioner at any hearing held under this chapter. The fees for travel and attendance of witnesses summoned or used by the Commissioner and fees for officers shall be the same as for witnesses and officers before a court and shall be paid by the State upon presentation of proper bills of cost to the Commissioner of Finance and Management, but no fees or expenses shall be payable to a witness charged with a use tax liability.

  (c) Any examination under oath conducted by the Commissioner may, in his or her discretion, be reduced to writing and willful false testimony shall be deemed perjury and be punishable as such.

  (d) Any Superior judge upon application of the Commissioner may compel the attendance of witnesses, the giving of testimony, and the production of any books, records, papers, vouchers, accounts, or documents before the Commissioner in the same manner, to the same extent, and subject to the same penalties as if before a Superior Court.

  (e) When under the laws of any other state, any taxes, fines, penalties, licenses, fees, deposits, or other obligations or prohibitions, additional to any imposed by this State upon any class of private or public motor vehicles not registered in such state are imposed upon any class of private or public motor vehicles in this State and their owners and operators traveling upon the public highways of such state, the same or similar taxes, fines, penalties, licenses, fees, deposits, or other obligations or prohibitions may be imposed upon all similar classes of private or public motor vehicles registered in such state and traveling upon the public highways of this State so long as such laws shall remain in force. The Commissioner shall determine the method of reciprocity.

  (f) In the event of a natural disaster that causes or may cause substantial damage or injury to persons or property, the Commissioner may waive the licensing requirements of sections 415 and 3007 of this title for emergency response units. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 74, §§ 5, 6, eff. April 28, 1983; 1983, No. 195 (Adj. Sess.), § 5(b); 1987, No. 112, § 7; 2009, No. 154 (Adj. Sess.), § 162; 2019, No. 131 (Adj. Sess.), §§ 223, 224.)

• § 3022. Proceedings to recover tax

  (a) Whenever any person fails to pay any tax, penalty, or interest, the Attorney General shall, upon the request of the Commissioner, enforce the payment on behalf of the State in any court of the State or of any other state of the United States or of any province of Canada.

  (b) The remedy for the collection of taxes provided by 32 V.S.A. § 9811(b) shall be available to the Commissioner as an additional or alternate remedy and the Commissioner may issue a warrant directed to an enforcement officer who may exercise throughout the State the same powers granted to a sheriff in his or her county.

  (c) The Commissioner is authorized to contract with private collection agencies for collection of tax penalties and interest imposed on persons who have failed to pay after reasonable notification of the debt. The Commissioner may agree to pay collection agencies a fixed rate for services rendered or a percentage of the amount actually collected by the agencies and remitted to the State. Notwithstanding 32 V.S.A. § 502, the Commissioner may charge against the collections an agreed-upon fixed rate or percentage of collections. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1987, No. 111, § 6.)

• § 3023. Review of Commissioner’s decision

  (a) Any aggrieved licensed user or taxpayer may have any decision, order, or finding of the Commissioner made under this chapter reviewed under Rule 75 of the Vermont Rules of Civil Procedure. Such review shall be to the Washington Superior Court or, in the discretion of the appellant, to the Superior Court in the county where the licensed person has his or her principal place of business or residence. The hearing on the review shall be de novo.

  (b) The appeal provided by this section shall be the exclusive remedy available to any licensed user or taxpayer for review of a decision of the Commissioner. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1985, No. 58, § 6.)

• § 3024. Penalties

  (a) Any person under this chapter who shall willfully: fail or refuse to pay the tax imposed or engage in any activity for which a license is required without having procured and maintained such license; fail to make any of the reports required; make any false statement in any application, report, or statement required; refuse to permit the Commissioner or any deputy to make the examination as provided by subsection 3013(c) of this title; fail to keep proper records of quantities of fuel received, sold, used, or delivered in this State as required; make any false statement on any delivery ticket or invoice as to the quantity of fuel delivered, sold, or used; make any false statement in connection with a report or an application for the refund of any monies or taxes; or engage in any act or activity with the intent to evade payment to or prevent collection by the State of the tax imposed shall be, in addition to any other prescribed penalties, guilty of a misdemeanor punishable by a fine of not more than $5,000.00 or imprisonment for not more than one year, or both.

  (b) It shall be unlawful for any person:

  (1) to operate a motor vehicle subject to the provisions of this chapter upon any public highway in the State without first obtaining the diesel fuel user’s license and marker required under section 3007 of this title or to so operate without displaying the marker or to so operate without having in the vehicle the license issued under section 3007 or a permit issued under section 3010 of this title;

  (2) to violate any regulation issued by the Commissioner pursuant to the authority granted under this section; or

  (3) to operate a motor truck without maintaining the record required by section 3025 of this title.

  (c) Any person who violates any provision of subsection (b) of this section shall be fined not more than $2,000.00 or not less than $500.00. Such penalty shall be in addition to the penalty imposed by any other section of this chapter. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 10, eff. April 21, 1983; 1985, No. 58, § 7; 2015, No. 47, § 45; 2019, No. 131 (Adj. Sess.), § 225; 2023, No. 85 (Adj. Sess.), § 312, eff. July 1, 2024.)

• § 3025. Records required

  (a) The user of a motor truck with a gross weight or registered weight of 26,001 pounds or more shall maintain a daily record of total miles traveled and miles traveled within the State.

  (b) Such records shall be retained by the user for a period of not less than four years and shall be available for inspection by the Commissioner or designated agents or enforcement officers. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1983, No. 44, § 5, eff. April 21, 1983; 1999, No. 154 (Adj. Sess.), § 8; 2019, No. 131 (Adj. Sess.), § 226.)

• § 3026. Reports by railroads

  (a) Every person or corporation operating a railroad in the State shall file by mail a report with the Commissioner on forms prescribed by him or her, which shall include the number of gallons of fuel used in Vermont by railroad trains owned or operated by them on a quarterly basis on or before October 31 for the calendar quarter ending September 30, on or before January 31 for the calendar quarter ending December 31, on or before April 30 for the calendar quarter ending March 31, and on or before July 31 for the calendar quarter ending June 30.

  (b) Each report required under this section shall be accompanied by a remittance payable to the Agency of Transportation for an amount computed by multiplying the number of gallons of fuel indicated on the report at the rate per gallon for railroad fuel indicated in section 3003 of this title. (Added 1981, No. 172 (Adj. Sess.), § 1; amended 1987, No. 241 (Adj. Sess.), § 9; 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3027. Civil penalty

  In addition to any other penalty imposed for violation of this chapter, a civil penalty of $1,000.00 shall be imposed upon a purchaser or user for each instance in which the purchaser or user uses untaxed fuel to propel a motor vehicle upon the highways of the State. (Added 1985, No. 147 (Adj. Sess.), § 2; amended 1999, No. 154 (Adj. Sess.), § 9; 2019, No. 131 (Adj. Sess.), § 227.)

• § 3028. Bulk sales; transferee liability

  (a) Whenever a licensee (transferor) required to collect and remit the tax required by this chapter shall make any sale, transfer, lease, or assignment (transfer) in bulk of any part or the whole of the assets of a business, otherwise than in the ordinary course of the business, the purchaser, transferee, lessee, or assignee (transferee) shall, at least 10 days before taking possession of the subject of the transfer or before payment therefor if earlier, notify the Commissioner in writing by mail of the proposed transfer and of the price and date thereof and whether or not the transferor has represented to, or has informed the transferee that the transferor owes any tax, interest, or penalties required by this chapter and whether or not the transferee has knowledge that such taxes, interest, or penalties are owed, and whether any taxes, interest, or penalties are in fact owed.

  (b) Whenever the transferee shall fail to give notice to the Commissioner as required by subsection (a) of this section, or whenever the Commissioner shall inform the transferee that a possible claim for tax, interest, or penalty exists, any sums of money, property, or choses in action, or other consideration, that the transferee is required to transfer over to or for the transferor shall be subject to a first priority right and lien for any taxes, interest, or penalty theretofore or thereafter determined to be due from the transferor to the State, and the transferee is forbidden to transfer the consideration to or for the transferor to the extent of the amount of the State’s claim.

  (c) For failure to comply with this section, the transferee shall be personally liable to the State for the amount of the State’s claim theretofore or thereafter determined to be due to the State from the transferor and the liability may be assessed and enforced against the transferee in the same manner as provided for by this chapter against the transferor. (Added 1999, No. 154 (Adj. Sess.), § 36; amended 2019, No. 149 (Adj. Sess.), § 17, eff. July 13, 2020.)

• § 3029. Personal liability

  Any licensee who fails to collect the tax required by this chapter or to pay it to the Commissioner in the manner required by this chapter shall be personally and individually liable for the amount of such tax and any interest and penalty assessed thereon pursuant to sections 3017 and 3018 of this title; and if the licensee is a corporation or other entity, the personal liability shall extend and be applicable to any officer or agent of the corporation or entity who as an officer or agent of the same is under a duty to collect the tax and pay it to the Commissioner as required in this chapter. (Added 1999, No. 154 (Adj. Sess.), § 37.)

• § 3030. Tax liability as property lien; discharge and foreclosure

  (a) If any licensee required to pay the tax under this chapter neglects or refuses to pay the same after demand is made by the Commissioner, the amount, together with all penalties and interest provided for in this chapter and together with any additional costs that may accrue, shall be a lien in favor of the State upon all property and rights to property, whether real or personal, belonging to such licensee. Such lien shall arise at the time demand is made by the Commissioner and shall continue until the liability for such sum with interest and costs is satisfied or becomes unenforceable. Such lien shall have the same force and effect as the lien provided for in 32 V.S.A. § 5895, and notice of such lien shall be recorded as provided for in 32 V.S.A. § 5895.

  (b) Release and foreclosure of the lien shall be as provided in 32 V.S.A. § 5895(b) and (c).

  (c) This section shall also apply to any officer or agent found personally liable pursuant to section 3029 of this title. (Added 1999, No. 154 (Adj. Sess.), § 38; amended 2019, No. 131 (Adj. Sess.), § 228.)

• § 3031. Lien fees

  Notwithstanding 32 V.S.A. § 502, the Commissioner may charge against any collection of liability any related lien filing fees specified in 32 V.S.A. § 1671(a)(6) or § 1671(c) paid by the Commissioner. Fees collected under this section shall be credited to a special fund established and managed pursuant to 32 V.S.A. chapter 7, subchapter 5, and shall be available as payment for the fees of the clerk of the municipality. (Added 1999, No. 154 (Adj. Sess.), § 40.)