(1) (a) (I) (A) An excise tax is imposed upon and is required to be paid by a distributor on all gasoline or special fuel acquired in, sold in, imported into, removed from any terminal in, or used in this state for any purpose whatsoever, but only one tax is required to be paid upon the same gasoline or special fuel in this state. For purposes of this subsection (1)(a)(I)(A), special fuel does not include liquefied petroleum gas.
(B) An excise tax is imposed upon and is required to be paid by a distributor on liquefied petroleum gas when it is placed in a fuel tank, unless the use of the special fuel is exempt. If the liquefied petroleum gas is placed in the fuel tank by a distributor, the distributor shall pay the tax to the department of revenue in accordance with this section.
(C) If a distributor uses liquefied petroleum gas from a cargo tank to propel a cargo tank motor vehicle on the highways in this state, an excise tax is imposed upon and is required to be paid by a distributor on the liquefied petroleum gas that is used as special fuel. The liquefied petroleum gas that is carried in the cargo tank but not used as special fuel is not subject to the excise tax. The tax imposed is computed upon an estimate of the total amount of liquefied petroleum gas, measured in gallons, used to propel the cargo tank motor vehicle based on the number of miles that the vehicle traveled. A distributor shall report to the department of revenue the number of miles that the vehicle traveled based on odometer readings. The department shall establish the form to be used to report this information.
(D) The tax imposed by this subsection (1)(a)(I) shall not apply to any acquisition, sale, import, or removal of gasoline or special fuel by bulk transfer to, from, or within a terminal or refinery in this state if the person acquiring, importing, or removing the gasoline or special fuel and the terminal operator or refinery are licensees. For purposes of this subsection (1)(a)(I)(D), a refinery is a licensee if the refiner is licensed to act as a terminal operator or a supplier in this state.
(II) (A) Except as provided in subsection (1)(a)(IV) of this section, the excise tax imposed on gasoline is twenty-two cents per gallon or fraction thereof.
(B) The excise tax imposed on special fuel by subsection (1)(a)(I) of this section is twenty and one-half cents per gallon or a fraction thereof. This subsection (1)(a)(II)(B) does not apply to any special fuel specified in subsections (1)(a)(VI), (1)(a)(VII), and (1)(a)(VIII) of this section.
(III) (Deleted by amendment, L. 2005, p. 863, � 1, effective July 1, 2005.)
(IV) (A) The excise tax imposed by subsection (1)(a)(I) of this section is six cents per gallon or fraction thereof on gasoline used as fuel for the propulsion of nonturbo-propeller or nonjet engine aircraft and is four cents per gallon or fraction thereof on gasoline used as fuel for the propulsion of turbo-propeller or jet engine aircraft.
(B) (Deleted by amendment, L. 2021.)
(C) Based upon reports submitted pursuant to this article 27, the department of revenue shall compile a monthly report showing the amount of excise taxes collected on gasoline pursuant to this subsection (1)(a)(IV). The department shall transmit the monthly report to the division of aeronautics created in section 43-10-103 for use by the division in distributing money in the aviation fund in accordance with section 43-10-110.
(V) Repealed.
(VI) The excise tax imposed on compressed natural gas by subparagraph (I) of this paragraph (a) is:
(A) Three cents per gallon or a fraction thereof for the 2014 calendar year;
(B) Six cents per gallon or a fraction thereof for the 2015 calendar year;
(C) Nine cents per gallon or a fraction thereof for the 2016 calendar year;
(D) Twelve cents per gallon or a fraction thereof for the 2017 calendar year;
(E) Fifteen cents per gallon or a fraction thereof for the 2018 calendar year; and
(F) Eighteen and three-tenths cents per gallon or a fraction thereof for calendar years beginning on and after January 1, 2019.
(VII) The excise tax imposed on liquefied natural gas by subparagraph (I) of this paragraph (a) is:
(A) Three cents per gallon or a fraction thereof for the 2014 calendar year;
(B) Five cents per gallon or a fraction thereof for the 2015 calendar year;
(C) Seven cents per gallon or a fraction thereof for the 2016 calendar year;
(D) Eight cents per gallon or a fraction thereof for the 2017 calendar year;
(E) Ten cents per gallon or a fraction thereof for the 2018 calendar year; and
(F) Twelve cents per gallon or a fraction thereof for calendar years beginning on and after January 1, 2019.
(VIII) The excise tax imposed on liquefied petroleum gas by subparagraph (I) of this paragraph (a) is:
(A) Three cents per gallon or a fraction thereof for the 2014 calendar year;
(B) Five cents per gallon or a fraction thereof for the 2015 calendar year;
(C) Seven cents per gallon or a fraction thereof for the 2016 calendar year;
(D) Nine cents per gallon or a fraction thereof for the 2017 calendar year;
(E) Eleven cents per gallon or a fraction thereof for the 2018 calendar year; and
(F) Thirteen and one-half cents per gallon or a fraction thereof for calendar years beginning on and after January 1, 2019.
(b) (I) In the case of gasoline or special fuel removed from a terminal, the tax is imposed upon the person first receiving the gasoline or special fuel at the terminal even if such person is also the supplier. In the case of gasoline or special fuel removed from a terminal by a common carrier, the consignor who owns the gasoline or special fuel removed by the common carrier is deemed to be the remover and first recipient thereof. The amount of gasoline or special fuel removed is deemed to be the amount shipped from the terminal, measured in gallons, as shown by the terminal manifest; except that an allowance of two percent of the total amount of gasoline or special fuel acquired during any calendar month, as shown by terminal manifests, is deducted by the licensed distributor to cover losses in transit and in unloading the gasoline or special fuel but there is no allowance for liquefied petroleum gas or removal by bulk transfer. The two percent allowance provided under this subsection (1)(b)(I) is allowed whether the terminal is within or without this state.
(II) (Deleted by amendment, L. 2021.)
(III) In the case of gasoline or special fuel imported into this state, except as provided in subsection (1)(a)(I)(D) of this section, the tax is imposed upon the importer at the time the gasoline or special fuel is first brought into this state from another state for sale, use, or storage and is measured by the number of gallons of gasoline or special fuel imported.
(IV) In the case of liquefied petroleum gas or natural gas sold by a vendor or by a distributor described in section 39-27-101 (7)(a)(V), or used by a private commercial fleet operator, the tax is imposed upon the vendor, distributor, or private commercial fleet operator at the time of such sale or use and is measured by the number of gallons placed into a fuel tank or receptacle from which a fuel tank is supplied.
(V) In the case of blended gasoline or blended special fuel sold by a blender thereof, the tax is imposed upon the blender at the time of sale. If the blender establishes that a tax was imposed and paid under this section, by the blender or by a licensed distributor from whom the blender acquired the gasoline or special fuel, the amount of tax so paid is allowed as a credit against the tax imposed by reason of this subsection (1)(b)(V).
(VI) In the case of a user, the tax imposed by this section is measured by the gallons of special fuel imported into this state or acquired without payment of the tax imposed by this section and used in the propulsion of a motor vehicle on the highways of this state.
(VII) In any other case, the tax imposed by this section is imposed upon the acquisition by each distributor and computed upon the total amount of gasoline or special fuel, measured in gallons, acquired by each distributor in this state and is required to be paid in the manner provided in this part 1. If the distributor establishes that a tax was imposed by this section upon the gasoline or special fuel acquired and paid by a licensed distributor, the amount of tax so paid is allowed as a credit against the tax imposed by reason of this subsection (1)(b)(VII).
(1.5) (Deleted by amendment, L. 2000, p. 1916, � 2, effective October 1, 2000.)
(2) (a) Except as set forth in section 39-27-102.5 (9), every person who uses any gasoline or special fuel for propelling a motor vehicle on the public highways of this state, upon which gasoline or special fuel a licensed distributor has not paid or is not liable to pay the tax imposed in this section, is deemed to be a distributor and is liable for and shall pay an excise tax at a rate established by subsection (1)(a) of this section on all such gasoline or special fuel so used in this state. Such person shall pay such tax to the department of revenue in the same manner as a distributor under section 39-26-105, on or before the twenty-sixth day of the calendar month following the month in which such gasoline or special fuel was used and shall, at the time of payment, render to the department, on forms provided by it, an itemized statement, signed under the penalties of perjury in the second degree, as defined in section 18-8-503, of all such gasoline or special fuel so used or imported during such preceding calendar month. When such gasoline or special fuel is delivered from a terminal in a carload lot, the quantity thereof and the amount of tax thereon is computed in the same manner as in the case of a distributor.
(b) A person operating a passenger car into this state may bring into the state, for the operation of such passenger car, not more than the capacity for gasoline or special fuel in the ordinary fuel tank attached to such passenger car without being liable for payment of the tax on such gasoline or special fuel. Any person operating a motor truck or motor bus into this state, except those persons operating a qualified motor vehicle pursuant to motor fuel tax cooperative agreement entered into under part 3 of this article, may bring into this state, for the operation of such motor truck or motor bus, not more than the capacity for gasoline or special fuel in the ordinary fuel tank attached to such motor truck or motor bus without being liable for payment of the tax on such gasoline or special fuel. Any person operating an aircraft into this state, other than an aircraft operated by scheduled air carriers or commuter airline operators, may bring into this state, for the operation of such aircraft, not more than the capacity for gasoline or special fuel in the ordinary fuel tank attached to such aircraft without being liable for payment of the tax on such gasoline or special fuel. In the event of a disagreement between the operator, driver, or owner of any vehicle, truck, or bus and any officer or inspector of this state regarding the capacity of the ordinary fuel tank of any vehicle traveling upon the highways, the operator, driver, or owner shall be required, at his or her own expense, to prove to the satisfaction of the officer or inspector the capacity of the ordinary fuel tank attached to such vehicle, and, in the event it exceeds that exempted by law, he or she shall be required to pay the tax on any additional gallonage then and there, securing a receipt from the officer or inspector with whom such disagreement occurred.
(c) and (d) Repealed.
(2.5) to (9) Repealed.
(10) Nothing in this section shall be construed to prohibit the criminal prosecution of any person who commits a criminal offense in connection with or as a result of violating any provision of this part 1.
(11) The tax imposed by this section is a debt owed to this state. Every person subject to it shall pay the tax imposed by this section in the manner prescribed by this part 1 irrespective of when payment is received by such person for the amount of any invoice for the sale of gasoline or special fuel including the tax thereon.
(12) On and after January 1, 2022, no supplier, distributor, importer, or terminal operator may sell gasoline or special fuel on a tax-deferred or tax-exempt basis, except as provided in section 39-27-102.5.
Source: L. 33: p. 718, � 2. L. 35: p. 905, � 2. CSA: C. 16, � 382. L. 53: p. 152, � 1. CRS 53: � 138-3-2. L. 63: p. 942, � 2. C.R.S. 1963: � 138-2-2. L. 64: p. 656, � 15. L. 65: pp. 1114-1118, �� 2-5. L. 67: pp. 335, 336, 985, �� 1, 2, 3, 1. L. 69: pp. 1140, 1141, �� 1-5. L. 71: pp. 1257, 1258, �� 1, 2. L. 72: p. 572, � 60. L. 73: pp. 1454, 1457, 1458, �� 3, 4, 1, 2. L. 75: (4)(a) amended, p. 1517, � 1, effective January 1, 1976. L. 77: (2)(b) amended, p. 1838, � 1, effective July 1; (3)(a), (4)(a),and (5)(a) amended and (4)(b) repealed, pp. 1840, 1841, �� 2, 3, effective January 1, 1978. L. 78: (1)(a) amended, p. 516, � 1, effective July 1. L. 79: (1)(a)(II) amended, p. 1330, � 3, effective May 8; (3)(a) and (6)(a) amended, p. 426, � 21, effective July 1; (1)(a)(I), (1)(a)(II), (1)(b), (2)(a), and (2)(b) amended and (2)(c), (2)(d), (3), (4), (5), (6), (7), and (8) repealed, pp. 1475, 1501, �� 2, 29, effective January 1, 1980. L. 80: (1)(b) amended, p. 737, � 1, effective April 10. L. 81: (1)(a)(II) amended, p. 459, � 2, effective May 18; (1)(a) and (2)(a) amended, p. 1893, � 1, effective June 19. L. 82: (1)(a)(III) amended, p. 573, � 1, effective April 23. L. 83: (1)(a)(II) amended, p. 1539, � 1, effective July 1. L. 84: (1)(a)(III) amended, p. 1024, � 1, effective July 1. L. 85: (1)(a)(III) R&RE, p. 1285, � 1, effective June 6. L. 86: (1)(a)(II) amended, p. 1127, � 1, effective July 1. L. 88: (1)(b) amended, p. 1330, � 1, effective April 13; (2)(b) amended, p. 1336, � 2, effective April 14; (1)(a)(I) and (2)(b) amended and (1)(a)(IV) added, p. 1091, � 7, effective January 1, 1989. L. 89, 1st Ex. Sess.: (1)(a)(II) R&RE and (1)(b) amended, p. 51, �� 1, 3, effective July 1; (1)(a)(II) R&RE and (1)(b) amended, p. 53, �� 1, 2, effective August 1. L. 91: (1)(a)(IV)(C) added, p. 2397, � 22, effective July 1. L. 91, 1st Ex. Sess.: (1)(a)(IV)(C) added, p. 7, � 11, effective July 1. L. 95: (1)(a)(I) and (1)(b) amended, p. 982, � 2, effective July 1. L. 98: (1)(a)(I), (1)(b), and (2)(a) amended and (1.5), (2.5), (9), and (10) added, p. 1023, � 2, effective July 1. L. 2000: (1)(a)(I) and (1.5) amended, p. 1916, � 2, effective October 1. L. 2003: (1)(a)(IV)(B) and (1)(b) amended, p. 1817, � 3, effective August 6. L. 2005: (9)(c) amended, p. 140, � 4, effective April 5; (1)(a)(I), (1)(a)(II), (1)(a)(III), (1)(b), (2)(a), (2)(b), (2.5), and IP(9)(a) amended and (1)(a)(V) added, p. 863, � 1, effective July 1. L. 2013: (1)(a)(II)(B) and (2)(a) amended and (1)(a)(VI), (1)(a)(VII), and (1)(a)(VIII) added, (HB 13-1110), ch. 225, p. 1059, � 6, effective January 1, 2014. L. 2014: (1)(b) amended, (HB 14-1105), ch. 107, p. 393, � 1, effective August 6. L. 2015: (1)(a)(I), (1)(b)(I), and (2.5) amended, (HB 15-1228), ch. 315, p. 1285, � 3, effective January 1, 2016. L. 2016: (1)(a)(IV)(B) amended, (SB 16-189), ch. 210, p. 796, � 114, effective June 6. L. 2021: (1)(a)(I), (1)(a)(II), (1)(a)(IV), (1)(b), and (2)(a) amended, (1)(a)(V), (2.5), and (9) repealed, and (11) and (12) added, (HB 21-1322), ch. 453, p. 2999, � 2, effective January 1, 2022.
Editor's note: (1) Amendments to subsection (2)(b) by Senate Bill 88-28 and House Bill 88-1250 were harmonized.
(2) The amendment to this section made by chapter 1, L. 91, First Extraordinary Session, p. 7, section 12, supersedes the amendment made by chapter 330, L. 91, p. 2397, section 22. Both acts contained a July 1, 1991, effective date. However the Governor did not sign the act enacted at the First Extraordinary Session until July 5. The act contained in chapter 1 from the First Extraordinary Session was subject to an interrogatory submitted to the Supreme Court by the Governor. The court held the act constitutional on its face. (See In re House Bill 91S-1005, 814 P.2d 875 (Colo. 1991).)
(3) Section 3 of chapter 107 (HB 14-1105), Session Laws of Colorado 2014, provides that changes to this section by the act apply to fuel sales between governmental entities that occur prior to, on, or after August 6, 2014.
Cross references: (1) For the legislative declaration contained in the 2003 act amending subsections (1)(a)(IV)(B) and (1)(b), see section 1 of chapter 278, Session Laws of Colorado 2003.
(2) For the legislative declaration in the 2013 act amending subsections (1)(a)(II)(B) and (2)(a) and adding subsections (1)(a)(VI), (1)(a)(VII), and (1)(a)(VIII), see section 1 of chapter 225, Session Laws of Colorado 2013.
(3) For the legislative declaration in HB 15-1228, see section 1 of chapter 315, Session Laws of Colorado 2015.
39-27-102.5. Exemptions on tax imposed - ex-tax purchases - performance statement - definition - repeal.
(1) (Deleted by amendment, L. 2005, p. 866, � 2, effective July 1, 2005.)
(1.5) Except as otherwise provided in this section, diesel engine fuel and kerosene is presumed to be for use for a taxable purpose unless indelible dye meeting federal regulations is added to the diesel engine fuel or kerosene before or upon removal from a terminal. Such dyed special fuel is exempt from the excise tax imposed pursuant to this part 1. The tax-exempt special fuel shall not be used for taxable purposes; except that dyed special fuel may be used for a taxable purpose to the extent that such use is allowed under federal law or regulations with such fuel being subject to the excise tax imposed pursuant to this part 1. For purposes of this subsection (1.5), taxable purpose means any use on which an excise tax on special fuel is imposed pursuant to this part 1. The terminal operator shall ensure that tax-exempt special fuel is dyed before it leaves the terminal. Every seller thereafter shall give notice to any purchaser in accordance with federal regulations that the dyed special fuel may not be used for a taxable purpose.
(2) (a) Dyed diesel fuel purchased to propel farm vehicles, when the same are being used on farms and ranches, farm tractors, and implements of husbandry only incidentally operated or moved on a highway, when operated off the public highways, and vehicles or construction equipment operated within the confines of highway construction projects when the same are actually being used in the construction of such highways is exempt from the excise tax imposed pursuant to this part 1. In accordance with section 39-27-104 (1)(d.5), dyed diesel fuel may be blended by a licensed distributor with biodiesel fuel after withdrawal at a terminal up to the maximum federally allowable blend. Such blended special fuel is exempt from the excise tax imposed pursuant to this part 1, so long as it is purchased for the purposes set forth in this subsection (2)(a). A person who purchases undyed special fuel for the purposes set forth in this subsection (2)(a) may, in accordance with section 39-27-103, apply to the department of revenue for a refund of the excise tax paid thereon.
(b) (I) (Deleted by amendment, L. 2005, p. 866, � 2, effective July 1, 2005.)
(II) Gasoline and special fuel purchased by the United States or any of its agencies, the state of Colorado or any of its agencies, any town, city, county, city and county, school district of this state, or any other political subdivision of this state is exempt from the excise tax imposed pursuant to this part 1, regardless of whether the special fuel is dyed pursuant to subsection (1.5) of this section, if the gasoline or special fuel is used exclusively by the governmental entity in performing its governmental functions and activities. This exemption only applies if the gasoline or special fuel purchased by the governmental entity is used in machines owned or operated by the governmental entity. Exemptions for persons conducting business for the governmental entities on a contract basis using an aircraft must be based solely on the applicable operating certificate of the aircraft operator pursuant to subsection (2.5) of this section.
(III) (A) Any governmental entity referred to in subsection (2)(b)(II) of this section may obtain an exemption certificate from the executive director of the department of revenue pursuant to subsection (3) of this section.
(B) A distributor may sell ex-tax gasoline or special fuel to a governmental entity with a valid exemption certificate, regardless of whether the special fuel is dyed pursuant to subsection (1.5) of this section.
(C) A governmental entity with a valid exemption certificate may sell to or purchase gasoline or special fuel from another governmental entity that also has a valid tax exemption certificate. The gasoline or special fuel must be used exclusively by the purchasing governmental entity in performing its governmental functions and activities in machines owned or operated by the governmental entity. A governmental entity is required to keep a copy of the fuel tax exemption certificate on file for any entity to which it resells or distributes fuel. A governmental entity that sells gasoline or special fuel pursuant to this subsection (2)(b)(III)(C) is not required to be a licensee pursuant to section 39-27-104. Sales authorized pursuant to this subsection (2)(b)(III)(C) are intended to facilitate intergovernmental efficiencies with respect to sales for individual vehicles or equipment. This subsection (2)(b)(III)(C) does not apply to intergovernmental sales in excess of five hundred gallons in a single transaction unless required for unusual, unforeseen, or emergency circumstances.
(D) In the case of gasoline or special fuel acquired by a governmental entity upon which the tax imposed by this part 1 was paid, the governmental entity may apply to the department of revenue for a refund of the excise tax paid thereon in accordance with section 39-27-103.
(c) Any person operating a vehicle other than a qualified motor vehicle pursuant to the motor fuel tax cooperative agreement entered into under part 3 of this article may bring into this state for the operation of such vehicle only the amount of special fuel that is in the ordinary fuel tank attached to such vehicle without being liable for the payment of the tax under this part 1.
(2.3) (a) The purpose of the exemption authorized in subsections (1.5) and (2)(a) of this section is to entirely exclude dyed diesel or kerosene from the special fuels excise tax where the dyed fuel is used for specified off-road purposes or by governmental entities.
(b) The effectiveness of the exemption authorized in subsections (1.5) and (2)(a) of this section is measured by the number of taxpayers claiming the exemption and the amount of tax that would have been paid without the exemption.
(2.5) (a) (I) Products, including kerosene, specially prepared, sold, and used in aircraft operated by scheduled air carriers or commuter airline operators exempt from the federal aviation fuels tax are exempt from the tax imposed pursuant to this part 1.
(II) Prior to January 1, 2025, gasoline used by domestic or foreign part 121 air carriers or part 135 commuter air carriers authorized to provide passenger and cargo air transportation services pursuant to the regulations of the office of the secretary of transportation and federal aviation administration of the United States department of transportation is exempt from the tax imposed pursuant to this part 1. For those air carriers that are certificated by the United States department of transportation for both part 121 air carrier operations and part 135 on-demand operations, the provisions of this subsection (2.5)(a)(II) shall not apply to the air carrier's part 135 on-demand operations.
(III) Prior to January 1, 2025, gasoline used by direct air carriers providing air transportation to authorized public charter operators pursuant to 14 CFR 380 is exempt from the tax imposed pursuant to this part 1.
(IV) Subsections (2.5)(a)(II) and (2.5)(a)(III) of this section and this subsection (2.5)(a)(IV) are repealed, effective December 31, 2028.
(b) A distributor or terminal operator may sell ex-tax gasoline or special fuel to an air carrier described in this subsection (2.5). In the case of gasoline or special fuel acquired by an air carrier described in this subsection (2.5) upon which the tax imposed by this part 1 was paid, the air carrier may apply to the department of revenue for a refund of the excise tax paid thereon in accordance with section 39-27-103.
(c) Nothing in this subsection (2.5) exempts sales of aviation fuel from the sales tax imposed under article 26 of this title 39.
(3) (a) (Deleted by amendment, L. 2021.)
(b) (I) The executive director of the department of revenue shall issue an exemption certificate to a user of gasoline or special fuel to purchase ex-tax gasoline or special fuel if the user is exempt under subsection (2) or (2.5) of this section.
(II) A distributor may sell ex-tax gasoline or special fuel pursuant to subsections (2) and (2.5) of this section. The distributor may claim a credit against the tax accrued and payable for taxes due on ex-tax gasoline or special fuel or for taxes paid on ex-tax gasoline or special fuel by such distributor in a prior taxable period. If the distributor establishes that a tax was imposed and paid under this article 27 by a licensed distributor, special fuel is allowed as a credit on the distributor's next return. To the extent the credit exceeds the tax due, the executive director of the department of revenue shall issue a refund of such excess. The manifest, bill of lading, invoice, or other similar document issued by the supplier, importer, or distributor must state that the gasoline or special fuel is sold on an ex-tax basis.
(c) With each sale of gasoline or special fuel made without payment of the tax pursuant to this subsection (3), the distributor shall secure evidence that the user is exempt from tax under this section.
(d) A distributor has the burden of proving that gasoline or special fuel is exempt from tax pursuant to this section. The department of revenue may prescribe reasonable requirements of proof for the exemption.
(4) (Deleted by amendment, L. 2000, p. 1932, � 15, effective October 1, 2000.)
(5) to (8) Repealed.
(9) Compressed natural gas used to propel a motor vehicle on the highways of this state that is supplied to the user at a residential home is exempt from the special fuel tax imposed by this article.
(10) Gasoline or special fuel removed from a terminal by a licensed exporter exclusively for delivery to another state is exempt from the tax imposed by this part 1.
Source: L. 2000: Entire section added with relocated provisions, p. 1932, � 15, effective October 1. L. 2002: (2)(a), (2)(b)(I), (2)(b)(II), and (7) amended, p. 552, � 1, effective May 24. L. 2005: (1), (1.5), (2)(b)(I), IP(5)(a), (5)(b), (5)(e), (5)(f), (6)(a), and (7) amended, p. 866, � 2, effective July 1. L. 2009: (1.5) and (2)(a) amended, (SB 09-098), ch. 195, p. 877, � 2, effective August 5. L. 2013: (5), (6), and (8) repealed, (7) amended, and (9) added, (HB 13-1110), ch. 225, p. 1060, � 7, effective January 1, 2014. L. 2015: (3)(a) amended, (HB 15-1228), ch. 315, p. 1287, � 4, effective January 1, 2016. L. 2020: (7) repealed, (HB 20-1181), ch. 91, p. 365, � 2, effective September 14. L. 2021: (1.5), (2)(a), (2)(b)(II), (2)(b)(III), and (3) amended and (2.5) and (10) added, (HB 21-1322), ch. 453, p. 3004, � 3, effective January 1, 2022. L. 2024: (2.5)(a)(II) and (2.5)(a)(III) amended and (2.5)(a)(IV) added, (HB 24-1036), ch. 373, p. 2532, � 26, effective August 7. L. 2025: (2.3) added, (SB 25-026), ch. 362, p. 1965, � 7, effective August 6.
Editor's note: This section is similar to former � 39-27-202 as it existed prior to 2000.
Cross references: (1) For the legislative declaration in the 2013 act repealing subsections (5), (6), and (8), amending subsection (7), and adding subsection (9), see section 1 of chapter 225, Session Laws of Colorado 2013.
(2) For the legislative declaration in HB 15-1228, see section 1 of chapter 315, Session Laws of Colorado 2015. For the legislative declaration in HB 20-1181, see section 1 of chapter 91, Session Laws of Colorado 2020. For the legislative declaration in HB 24-1036, see section 1 of chapter 373, Session Laws of Colorado 2024.
39-27-103. Refunds - penalties - checkoff - limits on collections - performance statement. (1) A credit against the tax accrued or payable or a refund of tax paid is allowed for the tax imposed by this part 1 on gasoline or special fuel that is lost or destroyed by fire, lightning, flood, windstorm, explosion, accident, or other cause beyond the control of the distributor or transporter of such gasoline or special fuel. This credit or refund is allowed only on gasoline or special fuel in quantities of one hundred gallons or more lost or destroyed at any one time. Any loss of gasoline or special fuel while in transit or while being loaded or unloaded is subject to credit or refund under this section. After any such loss or destruction, the distributor or transporter must notify the executive director of the department of revenue within thirty days of such loss or destruction and, within the same deadline, must file with the executive director proof sufficient to establish the loss or destruction as the executive director may require. A refund of previously paid tax is allowed to the distributor or transporter in control of the gasoline or special fuel at the time it is lost or destroyed regardless of whether such person paid the tax imposed by this part 1 on the gasoline or special fuel lost or destroyed.
(1.5) A refund is allowed for the tax paid on gasoline or special fuel pursuant to this part 1 that was erroneously paid due to mistake of fact, law, or computation. The person who has paid any such tax may, within three years from the date of payment thereof, file with the department of revenue an application for refund of such tax so erroneously paid. The application must be on such forms as prescribed by the department of revenue. This subsection (1.5) does not apply to any refund claimable pursuant to subsection (1), (2), (2.5), or (3) of this section.
(2) Unless purchased ex-tax pursuant to section 39-27-102.5 (2)(b), a refund is made or credit allowed for the tax paid on all gasoline or special fuel that is purchased by the United States or any of its agencies, the state of Colorado or any of its agencies, any town, city, county, or any other political subdivision of the state. Except as provided in section 39-27-102.5 (2)(b)(III)(C), the gasoline or special fuel with respect to which a refund is claimed under this subsection (2) must be used exclusively by the governmental entity in performing its governmental functions and activities in any machines owned or operated by the governmental entity. Any other use or any resale for any other use is a violation of subsection (3)(c) of this section.
(2.5) Unless purchased ex-tax pursuant to section 39-27-102.5 (2.5), a refund is made pursuant to subsection (3) of this section for the tax paid on the following purchases of gasoline or special fuel:
(a) Products, including kerosene, specially prepared, sold, and used in aircraft operated by scheduled air carriers or commuter airline operators exempt from the federal aviation fuels tax;
(b) Gasoline used by domestic or foreign part 121 air carriers or part 135 commuter air carriers authorized to provide passenger and cargo air transportation services pursuant to the regulations of the office of the secretary of transportation and federal aviation administration of the United States department of transportation. For those air carriers that are certificated by the United States department of transportation for both part 121 air carrier operations and part 135 on-demand operations, this subsection (2.5)(b) shall not apply to the air carrier's part 135 on-demand operations; and
(c) Gasoline used by direct air carriers providing air transportation to authorized public charter operators pursuant to 14 CFR 380.
(2.7) A refund is made pursuant to subsection (3) of this section to any person who purchases gasoline or special fuel upon which the tax imposed by this part 1 has been paid if the gasoline or special fuel is used for the purpose of:
(a) Operating a stationary gas engine;
(b) Operating a motor vehicle on or over fixed rails;
(c) Operating a tractor, truck, or other farm implement or machine for agricultural purposes on a farm or ranch;
(d) Operating a state-licensed agricultural applicator aircraft from a private landing facility used solely and exclusively for agricultural applications, to the extent of fifty percent of taxes payable pursuant to section 39-27-102 (1)(a)(IV);
(e) Operating a motor boat;
(f) Cleaning or dyeing;
(g) Any commercial use other than the operation of a motor vehicle upon the highways of this state and the operation of any aircraft other than the operation of aircraft specified in subsection (2.5) or (2.7)(d) of this section; or
(h) Any other use that entitles a person to a refund under this part 1 or federal law.
(3) (a) (I) Any person who purchases gasoline or special fuel is entitled to a refund by the controller, upon voucher certified by the department of revenue of the amount of such tax paid upon complying with the applicable conditions and provisions of this section.
(II) Notwithstanding any other provision of this section, no person shall be entitled to a refund on purchases of gasoline or special fuel in quantities of less than twenty gallons.
(III) The executive director of the department of revenue shall calculate the amount of the refund allowed by subparagraph (I) of this paragraph (a) for gasoline or special fuel use in accordance with the industry-specific percentages of such fuel use exempted by said subparagraph (I) that can be justified by studies done by industries that use the fuel for such exempt purposes, studies done by other states for refunds of tax imposed on the fuel used for such exempt purposes, or studies done by the department about the historical fuel usage for such exempt purposes. The executive director shall set such percentages by rule promulgated in accordance with article 4 of title 24, C.R.S.
(a.1) Repealed.
(a.3) (I) Any person who purchases or uses gasoline for the propulsion of an aircraft shall be entitled to a refund by the controller if:
(A) The use of such gasoline in such aircraft is subject to the excise tax levied pursuant to section 39-27-102 (1)(a)(IV)(A); and
(B) The excise tax actually paid was the excise tax levied pursuant to any provision of section 39-27-102 (1)(a), excluding section 39-27-102 (1)(a)(IV)(A).
(II) The amount of such refund shall be the difference between the amount actually paid and the amount that should have been paid pursuant to section 39-27-102 (1)(a)(IV) as certified by the department of revenue.
(b) All applicants claiming a refund under the provisions of this section shall obtain a refund permit from the department of revenue by application therefor on such forms as it prescribes. Such permits shall be obtained before or at the time the first application for refund is made. The application shall be made under oath and shall contain, among other things, the name, address, and occupation of the applicant, and the nature of the business, and a sufficient description of the machines and equipment in which the gasoline or special fuel is to be used for which a refund may be claimed. Upon approval of the application, the department of revenue shall issue to the applicant a refund permit number, and refund claim forms with the approved exemption percentage to calculate the amount of the refund allowed. The department shall make additional copies of the application for refund forms available to dealers. It is the duty of the department of revenue to keep a record for twenty-four months of all permits issued and cumulative records of the amount of refund claimed and paid thereon.
(c) Refund permits shall be canceled by the department of revenue if no claim is filed by the permit holder for a period of twenty-four months. If any person makes any false statement in an application for a permit or upon any claim for refund or submits with any claim for refund an invoice that does not represent a bona fide purchase of gasoline or special fuel at the time and place and in the quantity indicated on the invoice, or if any dealer or other person prepares an invoice that does not represent a bona fide sale of gasoline or special fuel at the time and place and in the quantity indicated in the invoice, or if any person uses gasoline or special fuel on which refunds are claimed in any motor vehicle on the public highways of this state, except as provided in subsection (2) of this section, said person or dealer commits a class 2 misdemeanor. In addition, the executive director shall forthwith cancel the permit of such person, and such person shall not be issued a new permit within one year after such cancellation.
(d) Application for a refund under this section must be made within twelve months after the date of purchase of the gasoline or special fuel but not more than once each calendar quarter. Such application must be made on forms prescribed and furnished by the executive director of the department of revenue, which contain any information as the executive director may deem necessary. At the time of making each sale and delivery of gasoline or special fuel upon which a refund of tax may be claimed, the dealer shall prepare an invoice, in duplicate, in a form approved by the executive director and containing such information as the executive director may deem necessary and carrying a serial number that shall not be repeated through any one calendar year. No additional invoices covering the same sale and delivery of gasoline or special fuel shall be issued by the dealer. The original copy of such invoice shall be delivered to the purchaser of the gasoline or special fuel, and, upon payment in full of such invoice, the dealer shall enter thereon the dealer's full name and a notation showing payment thereof. With respect to invoices covering the sale and delivery of gasoline or special fuel to the state or those political subdivisions of the state specified in subsection (2) of this section, it is not necessary for the dealer to enter the dealer's name and the notation showing payment thereof. Upon proper application, refund is made directly to such political subdivisions upon presentation of the completed refund claim form. Original invoices together with a certification of the date and number of the warrant by which such invoices were paid must be retained by such political subdivisions for a period of twenty-four months. The duplicate copy of the invoice must be retained by the dealer for a period of twenty-four months at the place of business where issued, and such duplicate invoices and other records of the dealer shall be available for examination by the executive director or the executive director's representatives. The executive director shall make demand for repayment of any refund of tax that has been illegally or erroneously made to any person, and the executive director is authorized to request the attorney general or any district attorney of the state to institute a suit for collection of any money illegally or erroneously refunded to any person.
(e) Except as provided in subsection (2.5) of this section, no refund shall be claimed by or allowed to any person on account of any gasoline or special fuel carried from this state in the ordinary fuel tank of a motor vehicle or aircraft. The application for a refund must be made by the same person who purchased the gasoline or special fuel upon which the tax imposed by this part 1 has been paid as shown in the invoice of the seller thereof. The right of any person to a refund under this part 1 shall not be assignable. No refund of the gasoline or special fuel tax shall be claimed by or allowed to any person on any gasoline or special fuel used for propelling motor vehicles operated in whole or in part during the calendar year upon public highways of the state or upon the streets of any city or town in the state, except as otherwise provided in this subsection (3) or subsection (2) of this section.
(f) (Deleted by amendment, L. 2002, p. 553, � 2, effective May 24, 2002.)
(4) Any applicant for refund under the provisions of this section who willfully makes any false statement in connection with an application for a permit or an application for a refund of any taxes, or who uses the gasoline or special fuel other than as stated in the permit and application, shall be punished as provided by section 39-21-118, and by suspension or revocation of his or her permit or license. These penalties shall be in addition to any other penalty imposed by this part 1. If any applicant for refund under the provisions of this section makes any false statement on any application for permit or credit for refund, or submits any invoices on which erasures, changes, alterations, or additions have been made, or that are otherwise incorrect, the executive director shall cancel all or part of any pending claim for refund of such applicant and shall also deduct from any subsequent claims an amount equal to one hundred percent of the amount claimed on any altered or incorrect invoice.
(5) If any person is convicted under the provisions of this section, such conviction shall be prima facie evidence that all refunds received by such person during the current year were obtained unlawfully, and the executive director is empowered to bring appropriate action for recovery of such refunds. A brief summary statement of the above mentioned penalties shall be printed on each form of permit and application for refund.
(6) and (7) Repealed.
(8) (a) The purpose of the refund authorized in subsections (2.7) and (3) of this section is to compensate taxpayers who buy and pay the tax on otherwise taxable fuels for the purpose of using the fuels for specified non-taxable purposes under federal law.
(b) The effectiveness of the refund authorized in subsections (2.7) and (3) of this section is measured by the number of taxpayers claiming a refund and the amount of tax that was already collected and is refunded.
Source: L. 33: p. 720, � 3. CSA: C. 16, � 383. L. 43: p. 192, � 1. L. 51: p. 190, �� 1, 2. L. 53: p. 157, � 2. CRS 53: � 138-3-3. L. 55: pp. 912, 913, �� 1, 1. L. 59: p. 789, � 1. L. 63: pp. 943, 944, �� 3, 4. C.R.S. 1963: � 138-2-3. L. 64: p. 812, � 1. L. 67: pp. 337, 495, �� 4, 1. L. 79: (3)(a.1) added, p. 1330, � 4, effective May 8; (3)(d) amended, p. 1503, � 1, effective July 1; (1), (2), (3), and (4) amended and (6) repealed, pp. 1477, 1501, �� 3, 29, effective January 1, 1980. L. 85: (4) amended, p. 1259, � 16, effective January 1, 1986. L. 87: (1.5) added, p. 1464, � 1, effective May 8. L. 88: (2) amended, p. 1331, � 2, effective April 13; (3)(a) and (3)(e) amended and (3)(a.3) added, p. 1092, � 8, effective January 1, 1989. L. 94: (3)(a.1) repealed, p. 1646, � 83, effective May 31. L. 97: (3)(d) amended, p. 55, � 1, effective July 1. L. 2002: (1), (1.5), (2), (3)(a), (3)(b), (3)(c), (3)(d), (3)(e), (3)(f), and (4) amended, p. 553, � 2, effective May 24. L. 2003: (3)(a)(I)(F) and (3)(a)(I)(H) amended, p. 1818, � 4, effective August 6. L. 2005: (2) amended, p. 869, � 3, effective July 1. L. 2012: (1) amended, (HB 12-1178), ch. 79, p. 261, � 1, effective September 1. L. 2013: (3)(a.3) amended, (HB 13-1110), ch. 225, p. 1062, � 8, effective January 1, 2014. L. 2014: (2) amended, (HB 14-1105), ch. 107, p. 394, � 2, effective August 6. L. 2015: (7) added, (HB 15-1228), ch. 315, p. 1287, � 5, effective August 5. L. 2016: (3)(a)(I)(F) amended, (SB 16-189), ch. 210, p. 796, � 115, effective June 6. L. 2021: (1), (1.5), (2), (3)(a)(I), (3)(d), and (3)(e) amended, (2.5) and (2.7) added, and (7) repealed, (HB 21-1322), ch. 453, p. 3007, � 4, effective January 1, 2022; (3)(c) amended, (SB 21-271), ch. 462, p. 3297, � 697, effective March 1, 2022. L. 2025: (8) added, (SB 25-026), ch. 362, p. 1965, � 8, effective August 6.
Editor's note: Section 3 of chapter 107 (HB 14-1105), Session Laws of Colorado 2014, provides that changes to this section by the act apply to fuel sales between governmental entities that occur prior to, on, or after August 6, 2014.
Cross references: (1) For the legislative declaration contained in the 2003 act amending subsections (3)(a)(I)(F) and (3)(a)(I)(H), see section 1 of chapter 278, Session Laws of Colorado 2003.
(2) For the legislative declaration in the 2013 act amending subsection (3)(a.3), see section 1 of chapter 225, Session Laws of Colorado 2013.
(3) For the legislative declaration in HB 15-1228, see section 1 of chapter 315, Session Laws of Colorado 2015.