Yesterday, a number of FuelQuest
clients, prospects, and friends gave us an hour of their time to learn more about excise motor fuel tax determination and the options a company has when calculating fuel taxes. We were privileged to be joined by Oscar Garza, Director at Deloitte Tax LLP
, who shared his insights on the market and the potential repercussions from inaccurate determination. Danny Norris, VP of Finance from MAPCO Express
, provided a case study of what challenges MAPCO faced, what key points they considered, and why they went with an integrated tax solution in combination with their existing ERP system, SAP. Of course, FuelQuest’s own Bubba Lange, SVP of our Zytax product line, weighed in on best practices when selecting a tax determination system.
As the premier provider of excise motor fuel tax automation software, talking about system selection isn’t exactly a stretch – one that might be construed as self serving. And, I readily admit that it was. I am happy to note, however, that the Fueling Business webinar on tax determination delivered educationally.
For example, what is the difference in tax determination and compliance? In summary, compliance is a compilation of historical data that is categorized, taxed, and paid to a jurisdiction, whereas determination is real-time calculation of tax liability that is transactional and based on the parameters of a transaction, considering all requirements, exceptions, and exemptions. So, now I know what determination is. Now the question is: why do I care?
The answer is (surprisingly) I might not. If I am a small retailer that accepts only delivered pricing and have no plans for sizable growth, I may decide I have no needs for indirect tax determination. The complexity just isn’t there. As my business grows, and I diversify the ways I purchase fuel, the complexities – and risks - increase. Ah, there’s the rub. See the chart below.
COMPLEXITY VS. RISK
And, what are the risks? Well, as Oscar from Deloitte shared with us from Stephanie Bland’s API address, in Section 6675 alone, you can be fined $10,000 for late filing and an additional $10,000 for missing or incorrect information. Forget the fines - can your already thin fuel margins take a $10,000 to $20,000 hit?
Segue to Danny Norris, VP of Finance from MAPCO Express, who operationally serves 430+ locations, is a licensed distributor in seven states, passes title at the rack, and splash blends ethanol products – and more. On the chart above, MAPCO would be fairly complex. As he explored alternatives ranging from manually tracking taxes, a custom build, and a bolt-on solution, he took into consideration not only his business model and its scalability, but also resources and constraints. After reviewing his options (and even with an extensive IT support team), he elected to use a bolt-on solution realizing that having Zytax maintain rates, schedules, and rules would in the long-term allow his team (finance) and IT team members to focus on other projects. MAPCO yielded tighter controls and decreased risk for their business by leveraging a customized, bolt-on solution.
These are just the highlights of the webcast. If you are convinced you need to learn more, email me to request the recorded version at
Thanks once again to our attendees and presenters. For more information on the webinar or the Fueling Business webinar series, please email me at