UPDATE 12-15-16 NJ PETROLEUM GROSS RECEIPTS TAX RATE INCREASE

UPDATE 12-15-2016

The State has announced that the increase to the NJ PGRT will be $0.159/gallon for on-road diesel fuel, effective January 1st, 2017. They further announced that there will be no change to NJ PGRT tax on gasoline for the 1st quarter of 2017.

NOTES:

1- The NJ PGRT is a variable tax rate and will be subject to change quarterly. We will continue to post rate updates each quarter.
2- The diesel tax increase was scheduled to be phased in over 2017, with the balance of the increase slated to take effect 7-1-2017

October 27, 2016

Allied Oil is posting this information to advise our customers of the details of the new fuel tax legislation and how it may impact them. We will continue to regularly update this posting as new information is made available. Please check back for updates and revisions.

The NJ Division of Taxation has just begun publishing details on the new law and taxes.
NJ PETROLEUM GROSS RECEIPTS TAX RATE INCREASE- UPDATE

The State of New Jersey is raising the NJ Petroleum Gross Receipts Tax (PGRT). It is to be increased by 12.85% of the surveyed average pre-tax price for fuel in the state as of Jul. 1, 2016. This increase will be on top of the $0.0400 per gallon currently being charged for the NJ PGRT.

GASOLINE

For gasoline the increase to the PGRT will take place on Nov. 1st, raising the tax on gasoline by $0.2260 per gallon. This rate increase will be in addition to the $0.0400/gal NJGRT previously in effect. The new rate is reported to be adjustable, with the ability to change as frequently as quarterly, as determined by periodic surveys of the statewide pricing by the Board of Public Utility.

For resellers only, this increase will also be applied to ‘floor stocks’- fuel volumes held in inventory. Resellers will be required to-
(1) take inventory volume as of the close of business on Oct. 31, 2016,
(2) report inventory to the state by Dec. 15, 2016 on forms that yet to be specified,
(3) remit to the state the increased tax levied on the fuel in inventory by Feb. 1, 2017.

Tanks over 10,000 gallons are to exempt the first 400 gallons and similarly the first 200 gallons for smaller tanks.

HIGHWAY DIESEL

The increase on the PGRT for ‘clear’ highway diesel will been broken into 2 parts- applying 70% of the increase (estimated at $0.1600/gal.) on Jan. 1 2017, and then the remaining 30% of the increase (estimated at $0.0700/gal.) on Jul. 1 2017.  Additionally, on or after Jul. 1, 2017 the pre-existing $0.0400/gal PGRT rate will be raised to $0.0800/gal, effectively raising the tax an additional $0.0400/gal.

For resellers only, this increase will also be applied to ‘floor stocks’- fuel volumes held in inventory at both implementation dates. Resellers will be required to-

PHASE 1

(1) take inventory volume as of the close of business on Dec. 31, 2016,
(2) report inventory to the state by Jan. 31, 2017 on forms that yet to be specified,
(3) remit to the state the increased tax levied on the fuel in inventory by Jun. 1, 2017.

PHASE 2

(1) take inventory volume as of the close of business on Jun. 30, 2017,
(2) report inventory to the state by Jul. 31, 2017 on forms that yet to be specified,
(3) remit to the state the increased tax levied on the fuel in inventory by Dec. 1, 2017.

Tanks over 10,000 gallons are to exempt the first 400 gallons and similarly the first 200 gallons for smaller tanks.

OFF ROAD DIESEL & HEATING OIL

NJ PGRT will no longer apply to most uses of off-road diesel and heating oil (including- farm equipment, construction equipment, generators and most commercial fishing vessels). Residential heating oil uses will continue to be exempted.

OTHER PETROLEUM PRODUCTS

The law raises the tax on other petroleum products like lube oils to 7% from 2.75%

REFUNDS & EXEMPTIONS

It is expected that operators of exempted systems like commercial fishing vessels, ambulances etc that use gasoline or ‘on-road’ ULSD will be required to pay the new PGRT taxes at time of purchase and then later file with the state for a refund of the PGRT.

Click the links below for a complete information and forms about the law.

2016-nj-pgrt-law-10-27-16-2

div-taxation-ppgrt-notice-2016-10-27

nj-pgrt-inventory-report

nj-pgrt-floor-tax-pay-form

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