Aviation Fuel Excise Tax
Colorado imposes an excise tax on aviation gasoline and jet fuel acquired, offered for sale, sold, or used in this state. Excise fuel tax are due when removed from a terminal or imported into the state. The tax is calculated on gross gallons acquired. The tax rate for aviation gasoline is 6¢ per gallon and the rate for aviation jet fuel is 4¢ per gallon.
Aviation Fuel has an exemption from excise tax for sales to direct air carriers, and FAA Part 121 or 135 air carriers as defined in §39-27-101(6), §39-27-101(19) and §39-27-101(20), C.R.S. When reporting aviation fuel disbursements to a FAA Part 121 or Part 135 air carrier, fuel distributors must provide the airport destination in Column 6 of their Distributor Schedule of Disbursements Worksheet (DR 7050). The Federal Aviation Administration (FAA) airport code is used to report the destination airport. For a listing of Colorado airports, visit the Colorado Airports Map provided by the Colorado Department of Transportation (CDOT).
Aviation Fuel Sales Tax
Colorado state and state-collected local sales tax is due on aviation jet fuel used in turbo-propeller or jet engine aircraft for all FAA Part 121 or 135 air carriers. Sales tax is charged on the purchase price of the fuel. The purchase price may include the cost of fuel, state and federal excise taxes, and any airport fuel flowage fees.
The amount of aviation jet fuel sold (retail sales) is reported when the retailer/distributor files their Aviation Fuel Tax Return (DR 1510). The entity who sells the fuel to the end user is responsible for remitting the aviation fuel sales tax. Only fuel is reported on the Aviation Fuel Sales Tax Return (DR 1510).
Due to the passage of Senate Bill 22-006 retailers with total net taxable sales of $100,000 or less for all sites are able to retain 5.3% of the state sales tax as compensation for the retailers expenses incurred in collecting and remitting the tax (the state service fee) for January 2023 through December 2023 filing periods. Retailers with total net taxable sales over $100,000, up to $1,000,000, are able to retain 4%, up to the maximum state service fee allowed of $1,000. Retailers with total net taxable sales over $1,000,000 are not able to retain the state service fee. The 5.3% state service fee is calculated on the return, form DR 1510. The reductions to the state service fee are calculated on the State Service Fee Worksheet, form DR 0103.
The revenues generated from the state sales tax are transferred to the aviation fund as required by statute (§43-10-109(1) C.R.S.). Tires, motor oil, and other aviation items are reported on the Retail Sales Tax Return (DR 0100).
Special Taxation Districts
RTD (Regional Transportation District), RTA (Rural Transportation Authority), and other special district sales tax must be paid if the sales are made within the boundaries of the district. Applicable county, city, and other local jurisdictional taxes must be remitted on the Aviation Fuel Sales Tax Return, DR 1510 form. Scientific and Cultural Facilities District (SCFD) taxes are not dues on the sale of aviation fuel.
If sales or use tax is imposed on the sale, the fee is subject to state and/or jurisdictional taxes that apply to the sale. Jet fuel or gasoline used for aviation can be subject to a fuel flowage (in-plane) fee imposed by the airport. This fee is part of the retail purchase price.
Use Tax on Airplanes
When purchasing personal property, including airplanes, the buyer needs to file a Consumer Use Tax Return (DR 0252) if the seller did not collect and remit sales tax for the purchase. The Consumer Use Tax Return can also be filed using Revenue Online. For airplane purchases, the return and the use tax payment are due on or before the 20th of the month following the purchase. For more information, visit the Consumer Use Tax section of this website.
Visit the How to Look up Sales and Use Tax Rates web page for information on how to determine the applicable use tax rate, which would include state, county, municipal, and special district use tax.
Aviation Tax Accounts & Licensing
Aviation Excise Taxes
Visit the Fuel Tax Licensing web page for information on licensing and reporting requirements.
Aviation Sales Tax
A sales tax license is required for aviation fuel sales tax. Also, a physical location is required for the collection of aviation fuel sales tax.
Add or Close Locations
To add a new location to your account or to close an existing location, submit a request to the Department by email or a secure web message through Revenue Online. When requesting a new site, you must include the commence date of the site, a physical address. All account locations for aviation fuel sales tax must be a new physical location. To close an existing site, submit a request to the Department by email or a secure web message through Revenue Online.
Excise taxes may be due on that fuel instead of sales tax if the fuel is not sold for use in Part 121 or 135 aircraft, or the fuel is not sold at an airport. Contact the Fuel Tax Unit by email or send a secure web message through Revenue Online for jurisdictional codes and additional information.