Were thirteen formulated racing-fuel blends subject to Florida motor-fuel tax or sales and use tax?

Plain-English summary

The thirteen racing-fuel blends were not subject to Florida motor-fuel tax, but their sales remained subject to sales and use tax. Each product was formulated exclusively for racing cars and had lead content far above the 0.05-gram-per-gallon limit in the gasoline definition the Department drew from federal and industry guidance.

The Department concluded that the products were not gasoline, were not blended with gasoline for statutory purposes, and could not be placed in an ordinary gasoline-powered vehicle's storage tank. They therefore fell outside the Chapter 206 motor-fuel definition on the documented facts.

What this means for you

Avoiding a specialized fuel excise tax did not make the product tax free. The ruling separately imposed ordinary sales and use tax on the racing-fuel sales.

Common questions

Q: Were the racing blends subject to motor-fuel tax? No.

Q: Why not? Their documented lead content and exclusive racing use placed them outside the Department's gasoline and motor-fuel definition.

Q: Were the sales exempt from all Florida tax? No. Sales and use tax still applied.

Q: How many products did the ruling address? Thirteen specified blends.

Citations and references

• Fla. Stat. §§ 206.01(9) and 206.41(1), (6) — motor-fuel definition and tax
• Fla. Stat. ch. 212 — sales and use tax
• Fla. Admin. Code ch. 12B-5 — motor-fuel rules cited
• I.R.C. § 4081 and 26 C.F.R. § 48.4081-1 — federal fuel guidance cited
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 01B5-002

Original ruling text

TAA 01B5002
SUMMARY
QUESTION: Are sales of formulated racing gasoline subject to Florida fuel taxes?
ANSWER - Based on Facts Below: The taxpayer sells thirteen (13) different blends of racing gasoline. Each blend
is manufactured for the exclusive use in racing cars, and each has a lead content of between three (3) and six (6)
grams per gallon. Florida fuel taxes are imposed, under s. 206.41(1), F.S., on each gallon of motor fuel sold in this
state. The term "motor fuel" is defined in s. 206.01(9), F.S., to include all gasoline products or any product blended
with gasoline. However, the term "gasoline" is not defined by the Florida Statutes. It is the position of the
Department, based on federal guidelines, that the definition of gasoline is any mixture used as a fuel in spark-ignition,
internal combustion engines, which has an octane number not less than 75, and a lead content not greater than 0.05
grams per gallon. Under this definition, the thirteen racing fuels sold by the taxpayer are not subject to Florida fuel
taxes because the racing fuels are not defined as gasoline.

[[January 4, 2002]]

Re:Technical Assistance Advisement 01B5-002
Subject: <>
Statutory References: Chapter 206, Florida Statutes (F.S.)
Rule References: Rule Chapter 12B-5, Florida Administrative Code (F.A.C.)
Taxpayer: XXX Taxpayer
Fuel Products for which Material Safety Data Sheets are supplied:
XXX (Product Code XXX) hereinafter referenced as Fuel #1
XXX (Product Code XXX) hereinafter referenced as Fuel #2
XXX (Product Code XXX) hereinafter referenced as Fuel #3
XXX (Product Code XXX) hereinafter referenced as Fuel #4
XXX Competition 110, hereinafter referenced as Fuel #5
XXX Super Stock 114, hereinafter referenced as Fuel #6
XXX Pro Stock 118, hereinafter referenced as Fuel #7
XXX, hereinafter referenced as Fuel #8
XXX, hereinafter referenced as Fuel #9
XXX, hereinafter referenced as Fuel #10
XXX, hereinafter referenced as Fuel #11
XXX, hereinafter referenced as Fuel #12
XXX, hereinafter referenced as Fuel #13.
Dear :

Your letter of October 24, 2001, to Rick McClure of the Office of the General Counsel, requesting a Technical
Assistance Advisement regarding the imposition of fuel tax on the sale of Fuels #1 through #13 referenced above, has
been forwarded to this office for a response.
FACTS AS PRESENTED
Material Safety Data Sheets (MSDS) were provided for the thirteen fuel products referenced above, and the Material
Safety Data Sheets for Fuel #1 through Fuel #4 reflect that each of these products belong to the chemical family,
"Blended Motor Fuel," and assigned the synonym of "Leaded Premium Gasoline."
The schedule provided with your letter, and information obtained from the Internet web site http://www.XX both reflect
that:
1.Fuel #1 has an octane number of 110, and contains 3.75 grams of lead per gallon;
2.Fuel #2 has an octane number of 112, and contains 4.25 grams of lead per gallon;
3.Fuel #3 has an octane number of 116, and contains 5.0 grams of lead per gallon, and;
4.Fuel #4 has an octane number of 120, and contains 5.0 grams of lead per gallon.
Material Data Safety Sheets provided for Fuel #5 through Fuel #7, reflect that these products belong to the chemical
family, "Petroleum Hydrocarbon Mixture," and they are each assigned the generic name, "Racing Gasoline." The
schedule provided with your letter, and information obtained from the Internet web site http://www.XX both reflect that:
1.Fuel #5 has an octane number of 110, and contains 4.2 grams of lead per gallon;
2.Fuel #6 has an octane number of 114, and contains 4.2 grams of lead per gallon, and;
3.Fuel #7 has an octane number of 118, and contains 4.2 grams of lead per gallon.
Material Data Safety Sheets provided for Fuel #8 through Fuel #12, reflect that these products belong to the chemical
family, "A Blended Motor Fuel," and they are each assigned the synonym, "Leaded Premium Race Fuel." The
schedule provided with your letter, and information obtained from the Internet web site http://www.XX both reflect that:
1.Fuel #8 has an octane number of 110, and contains 4.23 grams of lead per gallon;
2.Fuel #9 has an octane number of 112, and contains 4.23 grams of lead per gallon;
3.Fuel #10 has an octane number of 114, and contains 4.23 grams of lead per gallon;
4.Fuel #11 has an octane number of 116, and contains 4.23 grams of lead per gallon, and;

5.Fuel #12 has an octane number of 118, and contains 4.23 grams of lead per gallon.
The Material Data Safety Sheet provided for Fuel #13 reflects that this product is synonymous with "gasoline," and
that the lead content of Fuel #13 is between one and two percent. The schedule provided with your letter reflects that
Fuel #13 is leaded racing fuel having a lead content level of 4.1 grams per gallon.
LAW AND DISCUSSION
Section 206.41(6), F.S., provides:
(6) Unless otherwise provided for by this chapter, the taxes specified in subsection (1) are imposed on all of the
following:
(a) The removal of motor fuel in this state from a terminal if the motor fuel is removed at the rack.
(b) The removal of motor fuel in this state from any refinery if either of the following applies:

1. The removal is by bulk transfer and the owner of the motor fuel immediately before the removal is not a licensed
   terminal supplier; or
2. The removal is at the refinery rack.
   (c) The entry of motor fuel into this state for sale, consumption, use, or warehousing if either of the following applies:
3. The entry is by bulk transfer and the enterer is not licensed as a terminal supplier or importer; or
4. The entry is not by bulk transfer.
   (d) The removal of motor fuel in this state to an unregistered person, unless there was a prior taxable removal, entry,
   or sale of the motor fuel.
   (e) The removal or sale of blended motor fuel in this state by the blender thereof. The number of gallons of blended
   motor fuel subject to tax is the difference between the total number of gallons of blended motor fuel removed or sold
   and the number of gallons of previously taxed motor fuel used to produce the blended motor fuel.
   Section 206.01(9), F.S., assigns a three-pronged definition to the term motor fuel to mean:
   ... [1] all gasoline products or [2] any product blended with gasoline or [3] any fuel placed in the storage supply tank of
   a gasoline-powered motor vehicle. [numerals supplied]
   Your letter reflects that members of the Taxpayer buy and sell thirteen (13) products that are each identified by the
   Material Safety Data Sheets provided as either gasoline, racing gasoline, or a blended motor fuel. The conditions
   specified in subsection (6) of section 206.41, F.S., require the collection of fuel taxes on sales of products that are

defined as "motor fuel."
Consideration for rendering a decision will include, along with the information on the Material Safety Data Sheets, the
following statements taken from your October 11, 2000, request for a Technical Assistance Advisement:
Some of the racing fuels purchased and resold by the Taxpayer have an octane rating of 100 or higher and contain
between 1.0 gram to 6.0 grams of lead per gallon. These fuels do not have detergent additives that the United States
Environmental Protection Agency ("EPA") requires for gasoline. Also, these fuels do not meet the ASTM
specifications (D4814) for gasoline....
Moreover, the Internal Revenue Service deems that the racing fuels described in Part B above are not gasoline
products taxable as motor fuel under Section 4081 of the Internal Revenue Code....
Since racing gasoline is exempted from the Federal Manufacturer's Excise tax, and because "gasoline," is not defined
in the Florida Statutes, we shall look to the federal definition of the term found in s. 48.4081-2(i), Code of Federal
Regulations (C.F.R.), for guidance to determine whether racing fuel is subject to taxation under Florida law. Section
48-4081-2(i), C.F.R., defines "gasoline" to mean:
(1)All products (including gasohol (as defined in § 48.4081-6(b)(2))) that are commonly or commercially known or sold
as gasoline and are suitable for use as a motor fuel (other than products that have an American Society for Testing
Materials octane number of less than 75 as determined by the motor method); and....
Since the Material Safety Data Sheets provided specifically identify that the racing fuels purchased and resold by the
Taxpayer's members have an octane number greater than 75, and contain between 3.75 and to 4.25 grams of lead
per gallon, the American Society for Testing Materials publication, "Standard Specification for Automotive SparkIgnition Engine Fuel" for Designation D4814-99 is used for further guidance. Table 2, Detailed Requirements for all
Volatility Classes, found on page 1059, requires that unleaded gasoline designated by the A.S.T.M. as D4814,
Automotive Spark-Ignition Engine Fuel, may contain lead additives in a volume no greater than 0.05 grams per gallon.
Leaded gasoline designated as D4814 may contain lead additives in a volume no greater than 4.2 grams per gallon.
With regards to the specifications of gasoline authorized for use specifically in Florida, Rule section 5F-2.001, F.A.C.,
administered by the Department of Agriculture and Consumer Services, Division of Standards, provides additionally:
(1)Gasoline. The following specifications apply to gasoline sold or offered for sale in Florida. Specific variations or
exemptions may be made by the Department of Agriculture and Consumer Services for gasoline designed for special
equipment or service.
(a)Standards. All gasoline shall conform to the chemical and physical standards for gasoline as set forth in the
American Society for Testing and Materials designation D 4814-94a, "Standard Specification for Automotive SparkIgnition Engine Fuel."
(b)Analysis. For purposes of inspection and testing, laboratory analyses shall be conducted using the methods
recognized by the American Society for Testing and Materials designation D 4814-94a, "Standard Specification for
Automotive Spark-Ignition Engine Fuel."

(c)No person shall sell or offer for sale gasoline in this state that does not comply with the following requirements:
1.The total ethanol content of gasoline shall not exceed ten percent (10.0%), by volume;
2.The total methanol and co-solvents content of gasoline shall not exceed ten percent (10.0%), by volume;
3.The total ethanol and methyl tertiary butyl ether (MTBE) content of gasoline shall not exceed twelve percent
(12.0%), by volume....
(2)Every retail gasoline dispenser shall have conspicuously and firmly posted the octane rating of the gasoline being
sold therefrom in a manner conforming with 16 Code of Federal Regulations 306 (1-1-93) hereby adopted by
reference. Copies of this publication may be obtained from the Superintendent of Documents, U.S. Government
Printing Office, Washington, D.C. 20402.
(3)Every retail gasoline dispenser shall have the grade designation of the gasoline being sold therefrom conspicuously
and firmly attached thereto. The octane rating of gasoline sold using the following grade designations must meet the
minimum octane rating indicated:
Grade DesignationMinimum Octane Rating
Premium, Super, Supreme, High Test91
Midgrade, Plus89
Regular, Unleaded87
(4)All racing gasoline or gasoline designed for special use that is kept, offered, or exposed for sale, or sold at
retail that does not meet standards established in 5F-2.001(i):
(a)may not be advertised or represented, in writing or orally, to be suitable for use in ordinary motor vehicles
or boat motors;
(b)shall be accompanied by a conspicuous sign on the dispenser stating the product does not meet gasoline
specifications; and
(c)may not be dispensed into vehicles or boats unless the appearance of said vehicles or boats indicates they
are used primarily for racing or special purposes.... [Emphasis supplied]
CONCLUSION
It is the position of the Department, based on federal guidelines, that the definition of gasoline is any mixture used as
a fuel in spark-ignition, internal combustion engines, which has an octane number not less than 75, and a lead content
not greater than 0.05 grams per gallon. The thirteen gasoline products for which Material Safety Data Sheets were
provided with your request for a Technical Assistance Advisement all exceed the parameters found in the definition of
gasoline. These 13 products are not gasoline; are not products blended with gasoline; cannot be placed in the storage
tank of a gasoline-powered motor vehicle and are not within the definition of "motor fuel" as defined in s. 206.01(9),
F.S. The thirteen products are, however, subject to sales and use tax under the provisions of Chapter 212, F.S.
This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is binding on the
Department only under the facts and circumstances described in the request for this advice as specified in s. 213.22,
F.S. Our response is predicated on those facts and the specific situation summarized above. You are advised that
subsequent statutory or administrative rule changes or judicial interpretations of the statutes or rules upon which this

advice is based may subject similar future transactions to a different treatment than expressed in this response.
You are further advised that this response, your request and related backup documents are public records under
Chapter 119, F.S., and are subject to disclosure to the public under the conditions of s. 213.22, F.S. Ordinarily,
confidential information, such as the identity of the person to whom an advisement is issued, must be deleted before
public disclosure. In the situation in which a taxpayer association is seeking an advisement on behalf of its members,
having the identity of the requesting association remain in the published advisement is useful to those using the
advisement for guidance. No specific taxpayer information is included in an advisement issued to a taxpayer
association, and concerns about protecting proprietary information are not present under such circumstances.
However, in light of statutory requirements as to confidentiality, a taxpayer association must give its consent to the
Department to allow its name to be included in the published advisement. The taxpayer association to which this
advisement is issued has given written consent to allow the disclosure of its identity.
Sincerely,
Lynwood Taylor
Tax Law Specialist
Technical Assistance
and Dispute Resolution
LNT/lt
Control No. 47283