Gasoline and Special Fuel Distributors
Colorado excise tax is collected on motor fuels including gasoline, diesel, aviation fuels and special fuel. The tax rate for gasoline and gasohol is 0.22 a gallon. The special fuel (diesel and kerosene) tax rate is 0.205 per gallon. Aviation fuel taxes are collected on aviation gasoline (0.06 per gallon) and aviation jet fuel (0.04 per gallon). The tax is due and collected at the wholesale level when fuel is acquired at the terminal or imported into Colorado for gasoline, aviation and special fuel products.
Effective January 1, 2014, the tax on LPG, LNG and CNG fuels will be $.03 per gallon or gallon equivalent. CNG fuel will be taxed at the gallon equivalent rate, currently defined by the IRS as 126.67 cubic feet of natural gas. The tax rates for these fuels will change annual through 2019.
Any person who acts as a distributor, supplier, importer, exporter, blender, terminal operator or carrier of fuel in this state must be licensed as such. For definitions of these terms see Publication FYI Excise 5, Fuel Distributor Application, Licensing and Reporting Requirements.
To Apply for a Fuel License
You must complete a Fuel Distributor/Contract Carrier Application (DR 7064). Please refer to Fuel Distributors License Checklist (DR 0214) when applying for a Fuel License to ensure that your application is not missing any information. We strongly recommend that you use this document to aid you in completing the application packet.
All information requested on the application must be provided. License fees are $10 per application and $5 for each additional location. An original bond must be included with the application and fees in order for the application to be reviewed and approved. To review, process, and issue your license can take up to four to six weeks, so you should plan accordingly to have a license when you start your business. Also, the Surety Bond Application Form (DR 7065) must be included with application for license.
Upon approval of your Fuel License Application, you will receive your Fuel License displaying your Fuel Distributor Account Number. As a Fuel Distributor account holder, you will be required to file a monthly Fuel Distributor Tax Return (form DR7050), reporting all fuel distribution activities. A return must be filed every month whether there is activity or not. Electronic filing is mandatory. Fuel Distributor tax returns must be filed through the Colorado Fuel Tracking System (COFTS) at www.cofts.com. If tax is due on the return, electronic payment of tax by Electronic Funds Transfer (EFT) is also mandatory. For more information on filing returns, visit the COFTS website. In addition, you may click on the following link for information on the COFTS filing schedules and instructions for reporting various filing issues.
Changes in Ownership
If the ownership is a change other than stocks of a publicly traded company, a new application must be submitted. If the change in ownership requires a new federal identification number (FEIN), a new application must be filed with the Colorado Department of Revenue. Any person acquiring a ten per cent equity holding in a company or any change in ownership or equity within a twelve month period will require written notification to the Department of Revenue within 30 days. Any person who ceases to be a distributor, supplier, importer, exporter, blender, or carrier must notify the executive director of the Department of Revenue in writing by letter of the discontinuance, sale, or transfer at the time it takes place. All licenses shall be surrendered to the executive director at that time.
All licensed distributors must collect, report, and remit the "Environmental Response Surcharge Fee" to the Colorado Department of Revenue. Please see Publication FYI Excise 11, Environmental Response Surcharge for requirements and reporting for more information.