Include this fuel as a taxable sale on his report. Keep records and claim a refund as the fuel is used. The proper procedure should be explained to the distributor for future reporting. Audit adjustments should be made for tax-free use not supported by proper documentation. Tax-free use by suppliers is allowed and may be reported as such but requires proper documentation including gallons and date of use.
Fuel used for mowing or cleaning is exempt.
Fuel used in city vehicles including dump trucks, garbage trucks, etc. is taxable. Rule 3.176 covers the use of fuel by power take-off and auxiliary power units mounted on a motor vehicle. The use is specific to ready mix concrete trucks and solid waste refuse trucks. Diesel used in power-take off or auxiliary power units is covered in Rule 3.194. Mileage factor method per Rule 3.194.