DRS: PS 92(10.1), Tables and Equivalents for Natural Gas and Propane for Motor Vehicle Fuels Tax Purposes

 

STATE OF CONNECTICUT
DEPARTMENT OF REVENUE SERVICES

25 Sigourney Street
Hartford CT 06106-5032
 
 
 
 
 
 

 
 

This Policy Statement has been cited in SN 95(3), SN 95(4),
SN 95(14) and SN 95(20)

PS 92(10.1)

Tables and Equivalents for Natural Gas and Propane
for Motor Vehicle Fuels Tax Purposes


BACKGROUND: For motor vehicle fuels tax purposes, "fuels" is defined by Conn. Gen. Stat. Section 12-455a(b) as meaning "(1) fuels as defined in section 14-1 and (2) any other combustible gas or liquid suitable for the generation of power to propel motor vehicles." This definition includes natural gas and propane, as well as other fuels in gaseous form.

Until Policy Statement 92(10) was issued, the Department had not provided information concerning the computation of tax on motor vehicle fuels occurring in gaseous form. Policy Statement 92(10) provided factors for determining the quantity of natural gas in gaseous form that is equivalent to one gallon of gasoline. Those conversion factors were arrived at by comparing the number of BTUs (British Thermal Units) produced by the combustion of a gallon of gasoline with the number of BTUs produced by the combustion of 100 cubic feet of natural gas. That is, PS 92(10) called for gasoline and motor vehicle fuels occurring in gaseous form to be reduced to a common unit of measurement (BTUs). Therefore, implicit in PS 92(10) was a policy of taxing motor vehicle fuels not on a per-gallon basis, but according to their BTU production. The Department has now determined that the policy implied in PS 92(10) is flawed.


PURPOSE: The purpose of this Policy Statement is to establish a new approach to computing the tax imposed on motor vehicle fuels in gaseous form. The tax on natural gas in gaseous form shall be computed on the basis of its liquid gallon equivalent. Similarly, the tax on propane in gaseous form (compressed propane) shall be computed on the basis of its liquid gallon equivalent.


STATUTORY AUTHORITY: Conn. Gen. Stat. Sections 12-458(a) and 12-455a(b).


EFFECTIVE DATE: This Policy Statement shall take effect November 1, 1993.


DEFINITIONS, EQUIVALENCY AND CONVERSION SPECIFICATIONS:

"PROPANE" means a gaseous paraffin hydrocarbon, which becomes liquid under pressure or reduced temperatures, naturally occurring in crude petroleum and natural gas and also obtained by cracking, whether in gaseous or liquid form.

COMPRESSED PROPANE (GASEOUS FORM) EQUIVALENCY INFORMATION: At 14.73 lbs. of pressure per square inch (psi) and 60 degrees Fahrenheit:

  • 1 cubic foot propane = 0.0278 gallons propane
  • 100 cubic feet propane = 2.78 gallons propane
  • 1 gallon propane = 35.97 cubic feet propane
  • 100 gallons propane = 3597 cubic feet propane

"NATURAL GAS" means naturally occurring mixtures of hydrocarbon gases and vapors consisting principally of methane, whether in gaseous or liquid form.

NATURAL GAS (GASEOUS FORM) EQUIVALENCY INFORMATION: At 14.73 lbs. of pressure per square inch (psi) and 60 degrees Fahrenheit:

  • 1 cubic foot natural gas = 0.012 gallons natural gas
  • 100 cubic feet natural gas = 1.2 gallons natural gas
  • 1 gallon natural gas = 82.62 cubic feet natural gas
  • 100 gallons natural gas = 8262 cubic feet natural gas

A "British Thermal Unit" (Btu) is that amount of heat required to raise the temperature of one pound of water one degree Fahrenheit.

A "cubic foot" is a standard unit of gas measurement and is defined as the amount of gas occupying a cubic foot of space at a pressure of 30 inches of mercury (approximately 14.7 psi) and a temperature of 60 degrees Fahrenheit.

A "gallon" is a measure of volume equivalent to 231 cubic inches. When used as a standard unit of measure for liquid natural gas and other liquid fuels, it refers to a gallon of liquid fuel at a temperature of 60 degrees Fahrenheit.

To convert liters to gallons, the quantity of liters shall be multiplied by 0.26417 to determine the equivalent quantity in gallons.

When necessary to correct for temperature and pressure (i.e., when motor vehicle fuels are not measured at 14.73 psi or 60 degrees Fahrenheit), refer to the National Institute of Standards and Technology Handbook No. 44 (1991) for the proper correctional factors.


EFFECT OF THIS DOCUMENT: A Policy Statement is a document that explains in depth a current Department policy or practice affecting the liability of taxpayers. A Policy Statement indicates the Department's informal interpretation of Connecticut tax law and may be referred to for general guidance by taxpayers or tax practitioners.


EFFECT ON OTHER DOCUMENTS: PS 92(10) is superseded and may no longer be relied upon as of the effective date of this Policy Statement. This Policy Statement modifies SN 93(8) and SN 93(9).


PLEASE NOTE THE FOLLOWING NEW INFORMATION ABOUT DRS.

FOR FURTHER INFORMATION: To order forms and publications or for further information, call the Department of Revenue Services at 860-297-5962 (Hartford area or out-of-state) or 1-800-382-9463 (in-state). Forms and publications may be ordered through voice-mail 24-hours a day by choosing Option 3 on your touch tone telephone.

Electronic Delivery Options: You can also obtain tax forms and publications 24-hours a day from our Web home page at http://www.ct.gov/drs. Telecommunications Device for the Deaf (TDD/TT) users only call 860-297-4911 during business hours.


PS 92(10.1)
Motor vehicle fuels tax
Issued: 10/7/93
Replaces PS 92(10) (issued: 10\5\92)