Trump Announces He Will Sign Executive Order Making Red Diesel Use Tax-Free for All Purposes

At his rally in Nebraska, Trump announced that he had taken another "unprecedented" step to reduce costs.

Stating that the fuel known as "red dyed diesel" is used in agricultural vehicles, construction equipment and other off-road vehicles, Trump said that this fuel is exactly the same as normal diesel, but is sold tax-free for off-road vehicles and large trucks.

Trump stated that he would sign the executive order that would remove the off-road use requirement and allow "anyone to purchase red diesel tax-free for any purpose."

According to the information note shared by the White House, Trump signed the decision that temporarily allows the use of red diesel on roads and postpones the payment of the federal consumption tax applied to it.

With the decision, the US Treasury Department was instructed to postpone the payment of the federal excise tax on the use of red diesel on the road until the end of the year, without interest or penalty. The decision also envisaged investigating options to eliminate the obligation to pay deferred taxes.

While the US Department of Transportation was tasked with coordinating with states, industry representatives and labor organizations regarding access to this fuel, the US Department of Agriculture was asked to ensure farmers' access to red dyed diesel in areas where demand is high and to encourage states to take similar steps.

It was noted that the step in question aims to reduce fuel costs for American farmers, truck drivers and employees, for example, truck drivers can save over 100 dollars on each fuel fill-up.

It was shared that the federal diesel tax is 24.4 cents per gallon, which corresponds to approximately $60 for a 250-gallon fill.

It was stated that if the states take steps in parallel with the federal practice, the savings on one filling is expected to exceed $100.

In the country, diesel fuel is taxed according to its intended use.

While diesel used on highways is subject to state and federal excise taxes, diesel used for non-highway purposes such as agriculture and construction is not taxed.

This diesel used off-road is painted red so that law enforcement forces can detect the use of the fuel on the road and apply related penalties and retroactive taxes.