Motor Vehicle Fuel Tax
Taxation of Sales of Motor Fuel to the Kansas National Guard
KANSAS DEPARTMENT OF REVENUE
OFFICE OF THE SECRETARY
May 4, 2007
Revenue Ruling 19-2007-1
Re: Taxation of Sales of Motor Fuel to the Kansas National Guard
Motor-vehicle fuel or special fuel sold to or for use by the Kansas National Guard, including the Kansas Army National Guard and Kansas Air National Guard, is not exempt from Kansas motor fuel tax, whether such purchase is paid for by the U.S. Property and Fiscal Office or directly by the Kansas National Guard, in that such use is considered for the exclusive use of the State.
Although K.S.A. 79-3408 does exempt from motor fuel tax the sale of motor-vehicle fuels and special fuels to the United States of America and its agencies, and to certain contractors working for the federal government, such fuels sold to state agencies are not exempt from motor fuel tax. K.S.A. 48-201 provides a broad exemption from state excise taxes for the Kansas National Guard, but motor fuel tax is expressly excluded from this exemption.
The Internal Revenue Service has ruled that the sales of articles to a state National Guard are considered “for the exclusive use of a state or political subdivision” and are not subject to certain federal excise taxes “whether payment is made directly by the state, or from Federal funds appropriated to purchase articles for use by the National Guard.” Revenue Ruling 70-11, 1970-1 CB 229. See Revenue Ruling 68-671, 1968-2 CB 488.
Sales of motor-vehicle fuels and special fuels for use by the Kansas National Guard, which the U.S. Property and Fiscal Office has represented and the Internal Revenue Service has ruled is for the exclusive use of the State, are not exempt from Kansas motor fuel tax. Distributors should include the cost of Kansas motor fuel tax on invoices for fuel sold to the U.S. Property and Fiscal Office for the use by the Kansas National Guard.
This revenue ruling replaces and supersedes all prior advice, revenue rulings and rulings that have been issued regarding this issue.
Secretary of Revenue
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