Alternative fuel used to propel vehicles on public roads and highways of this state are subject to the alternative fuel tax at the time the alternative fuel is placed into the supply tank of a motor vehicle. Alternative fuels include natural gas, compressed natural gas, liquified natural gas, liquid petroleum gas, hydrogen or hydrogen compressed natural gas such as hythane, and any other fuel not taxable as gasoline or special fuel.
Each alternative fuel other than compressed natural gas, liquified petroleum gas and hydrogen are converted to a gasoline gallon equivalent. The basis of this conversion is statutorily set according to the gasoline gallon equivalency by type of alternative fuel based on the current fuel properties comparison chart published by the U.S. Department of Energy multiplied by the gasoline tax rate provided for in MCA 15-70-403.
Alternative fuel dealers must remit this tax. Reports and payments are due on or before the last day of April, July, October, and January following the calendar quarters ending March, June, September, and December. The tax applies to all sales made directly into the supply tank of any motor vehicle.
Impacts & Licensing
Current compressed natural gas dealer licenses and liquefied petroleum gas dealer licenses expire on December 31, 2023.
Existing licensees will be receiving their new alternative fuel dealer’s license by mail in December 2023.
New Alternative Fuel Dealers’ can apply by submitting the Alternative Fuel Dealer Application.
Alternative Fuel Tax Rates
| CNG | $0.07/GGE |
| Propane/LPG | $0.0518/gallon |
| Hydrogen | $0.33/GGE |
| Liquified Natural Gas/LNG | $0.33/GGE |
| Methanol | $0.33/GGE |
For questions regarding alternative fuel dealer licensing, reporting and rates please contact 406-444-0806 or 406-444-7664.
