Maryland Offers Guidance on Point of Taxation for Pipeline Transactions

Oct 29, 2020

In recent e-mail correspondence, the Comptroller of Maryland Audit Division offered some guidance on the point of taxation for gasoline and special fuel that is sold within the pipeline in Maryland. Responding to questions regarding sales that occur at specified breakout points along the Colonial Pipeline, the Comptroller said that the sale or transfer of title to product within a pipeline is not recognized until it reaches a Maryland terminal location. Once fuel reaches a Maryland terminal location, sales of gasoline will be taxable unless sold between two Class A Dealers while sales of special fuel between licensed sellers are exempt.