Join ARSA Ask ARSA Pay ARSA

Aviation Groups Aim to Repeal Onerous Fuel Fraud Measure

A coalition of aviation industry associations are seeking repeal of an unnecessary and onerous fuel fraud provision that places an unreasonable burden on business owners, deprives the Airport Airway Trust Fund of much needed revenues, and raises costs for noncommercial jet fuel users.

At issue is a measure included in the nation’s last long-term surface transportation law that required taxes on noncommercial aviation jet fuel be collected at the highway diesel fuel rate (2.5 cents higher than the aviation jet fuel tax).

While the law permits noncommercial jet fuel suppliers to file claims with the IRS to reimburse the cost difference, due to the substantial administrative burdens this places on the providers, many simply choose to forego the paperwork hassle and pass the cost to consumers.

The law not only raised consumer costs, it also permanently deprives the Airport & Airways Trust Fund of $50 million annually, as the collected tax is kept in the Highway Trust Fund and only transferred to the aviation account if the fuel supplier submits a refund application.

The provision was implemented due to unfounded worries that highway users were using aviation jet fuel to avoid paying higher taxes; an illogical concern given that aviation fuel is more expensive than diesel and can cause substantial harm to diesel engines, providing no incentive to engage in such efforts.

ARSA supports efforts to repeal this onerous tax and encourages its members to do the same. Please visit www.ARSAaction.org to urge your lawmakers’ support for this matter.

~~~ posted 3/7/12 ~~~



More from ARSA

ARSA Pushes Congress to Guarantee FAA Funding

On Dec. 17, ARSA delivered a letter to the chairman and ranking member of the U.S. House of Representatives Committee on Transportation & Infrastructure (T&I) supporting the Aviation Funding Solvency…Read More

Support Simplifying New D&A Rules

Dec. 22, 2025 Update: ARSA is developing compliance matrices for tracking requirements of both 14 CFR part 120 and 49 CFR part 40 against international laws. The association is working…Read More

ARSA & AEA Release SMS Guidance for U.S. Repair Stations

On Dec. 18, ARSA and the Aircraft Electronics Association (AEA) jointly released and industry advisory for U.S. repair stations holding EASA approval under the U.S./EU bilateral aviation safety agreement needing…Read More

Canadian Compliance Matrix Updated Ahead of New MIP’s Effective Date

On Sept. 9, the FAA and Transport Canada Civil Aviation (TCCA) released revision 2 of the Maintenance Implementation Procedures (MIP) issued under the bilateral aviation safety agreement between the United…Read More

SMS Integration Webinar Series Continues Jan. 20

On Dec. 16, ARSA and the Aircraft Electronics Association presented the third of six planned webinars – a monthly series stretching into March 2026 – explaining effective integration of a…Read More
ARSA