Nebraska taxes certain dyed diesel and charges petroleum businesses a diesel fee

The law imposes a tax of one-quarter cent per gallon on certain dyed diesel. The tax covers diesel fuel reported under the motor fuel tax law that meets one of these descriptions. The diesel must be dyed and marked under federal rules, or have the stated high sulfur level or low cetane rating and be dyed under federal rules. The tax begins October 1, 2026. Each fiscal year, the first $140,000 collected goes to the Motor Fuel Tax Enforcement and Collection Cash Fund, and the rest goes to the Agricultural Alcohol Fuel Tax Fund.

The law imposes a petroleum release fee of three-tenths of one cent per gallon on diesel fuel, including dyed diesel. The fee applies to producers, refiners, importers, distributors, wholesalers, or suppliers who sell, distribute, deliver, or use petroleum in Nebraska. The fee does not apply to exported petroleum. A refund is allowed for fees paid on petroleum later exported or destroyed, or bought for use by the federal government or its agencies. This fee provision takes effect October 1, 2026.

The law sets qualifications for Nebraska Ethanol Board members, including members who produce ethanol in Nebraska. The listed members include farmers, an ethanol producer, a labor representative, a petroleum marketer, and two additional ethanol producers. The Governor appoints board members with approval from a majority of the Legislature. A member who is an ethanol producer on August 31, 2026, may finish the term; otherwise, the Governor must appoint an ethanol producer within 30 days after September 1, 2026. The Governor must make the two additional producer appointments within 30 days after September 1, 2026. Their first terms end in 2028 and 2029.