Gasoline Excise Tax Rate Change Expected July 1, 2018

On July 1, 2018 the effective excise tax rate for gasoline without ethanol will increase from $.305 cents per gallon to $.307 cents per gallon. It is expected that all other fuel related excise tax rates will remain at their current rate. PMCI will be working closely with the Iowa Department of Revenue and we will provide members with an update in the event of any additional excise tax rate changes.

The Iowa Department of Revenue sets the excise tax rates for gasoline and ethanol blended gasoline based on the number of gallons of ethanol blended gasoline that is distributed in Iowa expressed as a percentage of the number of gallons of motor fuel distributed in the state, which is referred to as the distribution percentage. Iowa code requires the Department of Revenue to use monthly fuel tax reports to determine the distribution percentage for ethanol blended gasoline. These reports show that ethanol blended gasoline accounts for 65%-70% of the gasoline sold in the state of Iowa and excise tax rates are adjusted according to a formula set forth in Iowa Code 452A.3. According to the more accurate Retailers Fuel Gallons Annual Report ethanol blended gasoline’s actual market share is 87.2%.