N.Y. Tax Law § 523: Fuel use tax

§ 523. Fuel use tax. (a) Imposition. There is hereby imposed on and

after January first, nineteen hundred ninety-six a tax on fuel use for

the privilege of operating any qualified motor vehicle upon the public

highways of this state.

(b) Rate of tax. The tax imposed by this section shall be at a

composite rate determined by adding together (1) a fuel tax component

which shall be equal to the applicable rate per gallon in effect under

the taxes on motor fuel and diesel motor fuel imposed by article

twelve-A of this chapter and (2) a sales tax component, which shall be

equal to the sum of (A) a state sales and compensating use tax

subcomponent, equal to the applicable rate per gallon in effect under

the sales and compensating use taxes on motor fuel and diesel motor fuel

imposed by sections eleven hundred five and eleven hundred ten of this

chapter as described in subdivision (m) of section eleven hundred eleven

of this chapter plus (B) a local sales and compensating use tax

subcomponent, which shall be the lower of (i) the lowest applicable rate

per gallon in effect under the sales and compensating use taxes on such

fuels in effect in any county of this state imposing a local sales and

compensating use tax on a cents per gallon basis pursuant to the

authority of subpart B of part one of article twenty-nine of this

chapter, or (ii) the equivalent rate per gallon based on the highest

rate applicable to the receipts from the sale of a gallon of motor fuel

or diesel motor fuel in effect in any locality of this state imposing a

local sales and compensating use tax on a percentage rate basis on the

sale of motor fuel and diesel motor fuel pursuant to the authority of

subpart B of part one of article twenty-nine of this chapter. Provided,

however, that the total rate per gallon applicable to the receipts from

the sale of a gallon of such fuels imposed under clause (ii) of

subparagraph (B) of paragraph two of this subdivision shall not exceed

three percent. Such equivalent rate per gallon under clause (ii) of

subparagraph B of paragraph two of this subdivision shall be determined

as provided in subdivision (d) or (m) of section eleven hundred eleven

of this chapter and the schedules prescribed by the commissioner

pursuant to such subdivision (d), and shall be based on the average

price per gallon (including all federal and state and any local taxes

included in such price or imposed on the use or consumption of such

fuels upon which the state and local sales and compensating use taxes

are computed but determined without the inclusion of any state or local

sales tax on receipts from sales of such fuels) paid by the carrier

during the reporting period for all motor fuel and diesel motor fuel

purchased for use in its operations either within or without this state.

For purposes of clause (ii) of subparagraph (B) of paragraph two of this

subdivision, the price for motor fuel and diesel motor fuel purchased by

such carrier shall be deemed to be the prevailing price for motor fuel

and diesel motor fuel, as established by the commissioner each calendar

quarter pursuant to this section, applicable to the reporting period.

The commissioner shall for each calendar quarter establish a prevailing

price for motor fuel and diesel motor fuel based on the prices being

charged on any given day during the first fifteen days of the previous

calendar quarter at a minimum of ten selected truck stops widely

scattered throughout the state. The tax imposed by this section shall be

computed by multiplying such composite rate by the amount of motor fuel

or diesel motor fuel, as the case may be, used by a carrier in its

operations within this state during each reporting period. The amount of

motor fuel and diesel motor fuel used in the operations of any carrier

within this state shall be determined by dividing the number of miles

traveled in this state subject to tax under this section by the average

miles per gallon for the type of fuel. Where the records of any carrier

are inadequate or incomplete, the qualified motor vehicles of a carrier

filing returns shall be deemed to have consumed, on the average, one

gallon of diesel motor fuel for every four miles traveled or one gallon

of motor fuel for every three miles traveled unless substantial evidence

discloses that a different amount was consumed; provided, however, that

if the commissioner enters into a cooperative agreement pursuant to

section five hundred twenty-eight of this article and such agreement

prescribes a different average miles per gallon deemed to be consumed,

the commissioner shall prescribe such different average.