Kentucky Revised Statutes

Ky. Rev. Stat. § 138.220 (2026)

State gasoline and special fuel tax -- Supplementary highway user motor

✓ current as of May 2026

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fuel tax -- Imposition -- Determination of average wholesale price -- Additional tax or credit for tax-paid inventory -- Notification of average wholesale price to be given at least 20 days before July 1 of every year. (1) (a) An excise tax at the rate of nine percent (9%) of the average wholesale price rounded to the nearest one-tenth of one cent ($0.001) shall be paid on all gasoline and special fuel received in this state. The tax shall be paid on a per gallon basis. (b) The average wholesale price shall be determined and adjusted as provided in KRS 138.228. (c) For the purposes of the allocations in KRS 177.320(1) and (2) and 177.365, the amount calculated under this subsection shall be reduced by the amount calculated in subsection (3) of this section. (d) Except as provided by KRS Chapter 138, no other excise or license tax shall be levied or assessed on gasoline or special fuel by the state or any political subdivision of the state. (e) The tax herein imposed shall be paid by the dealer receiving the gasoline or special fuel to the State Treasurer in the manner and within the time specified in KRS 138.230 to 138.340 and all such tax may be added to the selling price charged by the dealer or other person paying the tax on gasoline or special fuel sold in this state. (f) Nothing herein contained shall authorize or require the collection of the tax upon any gasoline or special fuel after it has been once taxed under the provisions of this section, unless such tax was refunded or credited. (2) (a) In addition to the excise tax provided in subsection (1) of this section, there is hereby levied a supplemental highway user motor fuel tax to be paid in the same manner and at the same time as the tax provided in subsection (1) of this section. (b) The tax shall be: 1. Five cents ($0.05) per gallon on gasoline; and 2. Two cents ($0.02) per gallon on special fuel. (c) The supplemental highway user motor fuel tax provided by this subsection and the provisions of subsections (1) and (3) of this section shall constitute the tax on motor fuels imposed by KRS 138.220. (3) Two and one-tenth cents ($0.021), of the tax collected under subsection (1) of this section shall be excluded from the calculations in KRS 177.320(1) and (2) and 177.365. The funds identified in this subsection shall be deposited into the state road fund. (4) Notification of the average wholesale price shall be given to all licensed dealers at least twenty (20) days in advance of July 1 of each calendar year. (5) Dealers with a tax-paid gasoline or special fuel inventory at the time an average wholesale price becomes effective, shall be subject to additional tax or appropriate tax credit to reflect the increase or decrease in the average wholesale price for the new quarter. The department shall promulgate administrative regulations to properly administer this provision. Effective: April 15, 2020 History: Amended 2020 Ky. Acts ch. 91, sec. 4, effective April 15, 2020. -- Amended 2015 Ky. Acts ch. 67, sec. 15, effective March 25, 2015. -- Amended 2009 Ky. Acts ch. 8, sec. 2, effective March 13, 2009. -- Amended 2006 Ky. Acts ch. 252, Pt. XVIII, sec. 2, effective April 25, 2006. -- Amended 2005 Ky. Acts ch. 85, sec. 354, effective June 20, 2005; and ch. 173, Pt. XVII, sec. 2, effective July 1, 2005. -- Amended 1988 Ky. Acts ch. 285, sec. 2, effective August 1, 1988. -- Amended 1986 Ky. Acts ch. 174, sec. 13, effective July 1, 1986. -- Amended 1980 Ky. Acts ch. 218, sec. 2, effective July 1, 1980. -- Amended 1976 (1st Extra. Sess.) Ky. Acts ch. 6, sec. 1. -- Amended 1972 Ky. Acts ch. 61, sec. 1. -- Amended 1948 Ky. Acts ch. 45, sec. 1. -- Recodified 1942 Ky. Acts ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4281g-2.

Notes of Decisions

Cited in 12 cases, 1947–2018 · leading case: Dep't of Revenue v. Revelation Energy, LLC, 544 S.W.3d 170 (Ky. Ct. App. 2018).

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Dep't of Revenue v. Revelation Energy, LLC, 544 S.W.3d 170 (Ky. Ct. App. 2018). · cites it 5× “KRS 138.220 imposes an excise tax on all gasoline and special fuel received in Kentucky.”

Dalton v. State Prop. & Bldgs. Comm'n, 304 S.W.2d 342 (Ky. Ct. App. 1957). · cites it 6× “y be expended and used for the cost of administration, statutory refunds and adjustment, payment of highway obligations, cost of construction, reconstruction, right of ways, maintenance and repair of public highways, tunnels and bridges and the expense of enforcing state traffic…”

Bank of Sun Prairie v. Kentucky Dep't of Revenue, 796 F.3d 667 (7th Cir. 2015). “Another flaw in KDOR’s position is its failure to take into account KRS §§ 138.220 and 138.224. Section 138.220 allows a licensed dealer to add the excise tax to the selling price, as Marathon and *679 BP did, but it does not require a dealer to do so.”

Tpk. Auth. of Kentucky v. Wall, 336 S.W.2d 551 (Ky. Ct. App. 1960). “required to be set aside and paid over to Authority, for application as provided in the bond obligation, and to be credited against the rent in the same manner as the tolls and other revenues of the project, “all motor fuel taxes collected by the department on gasoline and other…”

Commonwealth ex rel. Ross v. Lee's Ford Dock, Inc., 551 S.W.2d 236 (Ky. 1977). “KRS 138.220 levies an excise tax (now 9% per gallon) on all gasoline received in this state.”

Dep't of Revenue v. Jack Cole Co., 474 S.W.2d 70 (Ky. Ct. App. 1971). “665(1), and upon gasoline, KRS 138.220, makes it clear that the statutes in combination constitute a use tax upon the use of fuel, which this court found to be unconstitutional in Ashland Oil, when applied to fuel bought tax paid in Kentucky and used upon the highways of other…”

Davis v. Howard, Comm'r of Revenue, 206 S.W.2d 467 (Ky. Ct. App. 1947). · cites it 5× “He then asked the court to declare the rights of the parties to be: “(1) That defendant, as Commissioner of Revenue of the Commonwealth of Kentucky, has no jurisdiction to impose upjon plaintiff the tax provided in KRS 138.220. “(2) That the tax imposed by KRS 138.”

Bowling Green-Warren Cnty. Airport Bd. v. Bridges Aircraft Sales & Serv., Inc., 460 S.W.2d 18 (Ky. Ct. App. 1970). · cites it 2× “Hence, it was unnecessary for the court to decide whether the attempted charge runs afoul of KRS 138.220 and KRS 138.-565. Neither was it required that the court adopt and approve OAG 65-237 and OAG 69-3.”

Jefferson Cnty. v. King, 479 S.W.2d 880 (Ky. Ct. App. 1972). “The Rural Secondary Road Fund is derived from the proceeds of a tax on gasoline of two cents per gallon, imposed by KRS 138.220 for the express purpose of “construction, reconstruction and maintenance of rural and secondary roads and for no other purpose.”

Brooks v. Pure Oil Co., 126 F. Supp. 426 (E.D. Ky. 1954). “270, Kentucky Revised Statutes upon defendant’s payments of excise taxes to the State under the provisions of KRS 138.220, on account of gasoline imported into the State and sold to plaintiff by defendant, a “Dealer”, as defined by KRS 138.”

Stand. Oil Co. v. Commonwealth ex rel. Allphin, 311 S.W.2d 372 (Ky. Ct. App. 1957). “Under KRS 138.220, the Kentucky gasoline tax is imposed upon gasoline “received” in this state, and must be paid by the “dealer” who “receives” the gasoline.”

Commonwealth, Transp. Cabinet v. Tony Brewer Trucking, Inc., 734 S.W.2d 486 (Ky. Ct. App. 1987). “660 to credit against such liability taxes duly paid, pursuant to KRS 138.220 and .565 inter alia, on gasoline and special fuels purchased in Kentucky by the licensee during the same time period “for use in its operations.”

— Ky. Rev. Stat. § 138.220(1)(c) — 1 case

Dep't of Revenue v. Revelation Energy, LLC, 544 S.W.3d 170 (Ky. Ct. App. 2018). “KRS 138.220 imposes an excise tax on all gasoline and special fuel received in Kentucky.”

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