006.05.06 Ark. Code R. 005-GR-29

Current through Register Vol. 49, No. 9, September, 2024

Rule 006.05.06-005-GR-29 - EXEMPTIONS FROM TAX - FUEL OIL, MOTOR FUEL, MOTOR OIL, LUBRICANTS, CRUDE OIL, AND AUTOMOBILE PARTS

A. The gross receipts or gross proceeds derived from sales of motor fuel or special motor fuel are exempt from the tax if the motor fuel tax or special motor fuel tax has been paid to the State of Arkansas. The gross receipts or gross proceeds derived from sales of fuel oil, motor oil and lubricants are subject to tax.

B. The gross receipts or gross proceeds derived from sales of unprocessed crude oil are exempt from the tax.

C. The gross receipts or gross proceeds derived from the sale of motor fuel or special motor fuel to the owners or operators of motor buses operated on designated streets according to regular schedule, under municipal franchise and which are used for municipal transportation purposes are exempt from the tax.

D. The gross receipts or gross proceeds derived from sales of special fuel or petroleum products for consumption by vessels, barges, other commercial watercraft and railroads are exempt from the tax. For purposes of this subsection the term "vessel" shall mean and describe any motor driven watercraft used for commercial purposes for the transportation of tangible property or persons on the rivers, lakes and navigable streams of Arkansas.

E. That portion of the gross receipts or gross proceeds derived from the sale of automobile parts which constitute "core charges" which are received for the purpose of securing a trade-in for the article purchased is exempt from the tax except that when the article is not traded in, then the tax is due on the "core charge".

Example 1: If a customer purchases a new battery for $40.00 plus a core charge of $8.00 and returns a used core for $8.00, tax would be due only on the $40.00 purchase price because the core was traded in or returned.

Example 2: If a customer purchases a new battery for $40.00 plus a core charge of $8.00 with no core traded in, tax would be due on the total consideration of $48.00.

006.05.06 Ark. Code R. 005-GR-29

Ark. Code Ann. §§ 26-52-401(11), (23), and (26); 26-52-417