From the HERE City State Desk
Tennessee farmers and foresters can use cheaper, tax-exempt dyed diesel on public roads through the end of October, Gov. Bill Lee announced Tuesday, as diesel prices remain near record highs during harvest season.
Lee said he directed state departments on Friday to suspend enforcement of laws that normally bar the red-dyed fuel from vehicles on public roads. His letter went to the commissioners of agriculture, revenue, transportation and safety, and also asked the revenue commissioner to seek penalty relief from the Internal Revenue Service.
The move follows an executive order President Donald Trump signed Monday temporarily deferring federal taxes on dyed diesel and allowing highway use through the end of the year.
Dyed diesel is chemically the same as regular diesel but is exempt from fuel taxes because it is meant for off-road farm, timber and industrial equipment. Regular diesel carries a federal tax of 24.4 cents per gallon and a Tennessee tax of 27 cents, so users could save about 51.4 cents a gallon with both waived.
Diesel averaged above $6.03 a gallon in Tennessee on Tuesday, according to AAA, after reaching an all-time high of $6.22 on Sept. 22. Two Republican state senators, Page Walley and Ken Yager, had asked Lee in late September to lift the restriction.