While few people are thinking about heating fuel right now, July 1 marked an important change in the Vermont tax code.

Since 1990, the Vermont Low Income Weatherization Program has been funded by a tax on heating oil, kerosene, dyed diesel, propane, natural gas and electricity. In 2016, the portion of the tax paid by heating oil, kerosene, dyed diesel and propane providers was converted from a tax based on gross sales to a tax based on gallons. The rate was set at 2-cents per gallon. This change also allowed the itemization of the Fuel Tax, much like the efficiency charge on Vermonter’s electric bill.

In the 2019 legislative session, a loophole in the law that exempted nonprofits, schools and governments from the 2-cent per gallon Fuel Tax was closed. The exemption was an unintended consequence of the 2016 conversion to a per gallon tax. The removal of these exemptions is expected to generate an additional $390,000 per year for the low income weatherization program.

If you would like to learn more about the taxes on fuel used by Vermonters to heat their homes and power their vehicles, check out vermontfuel.com/tax.

Matt Cota


The writer is the director of the Vermont Fuel Dealers Association.

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