Chilkat Valley News - Serving Haines and Klukwan, Alaska since 1966

 
 

By CVN Staff 

Borough clears fuel excise tax hurdle

 

October 6, 2011



Haines Borough recently received certification from the Internal Revenue Service allowing it to sell marine fuel without charging the federal excise tax of 24.3 cents.

Early in the summer, fuel supplier Delta Western did not renew its lease to staff the marine fuel dock at Haines Harbor and the borough took over the operation. For a few weeks, Delta Western charged the borough a federal highway excise tax on the fuel.

Borough finance director Jila Stuart said the tax was passed on to marine fuel customers for a short time in July during the transition. But the borough stopped charging the tax once they sorted out the details of taking over the fueling dock.

If customers were charged the tax, it would be noted on their fuel receipts and they can get refund on their federal taxes by submitting form 4126, "Credit for Federal Tax Paid on Fuels."

The borough has since stopped charging customers the tax, even though Delta Western continued to charge the tax to the borough. Stuart said she did not have an exact amount of how much of the tax the borough absorbed, rather than passing the tax on to fuel customers.

Now that the borough is a "qualified registered retailer with the IRS," Stuart said Delta Western should no longer charge the tax to the borough.

The borough this summer issued a request for proposals for a private entity to take over the fuel operation at the harbor, but did not receive any bids.