Gov. Sarah Huckabee Sanders extended Arkansas’ suspension of laws restricting the use of dyed diesel fuel on highways, allowing farmers and loggers to continue using the fuel through Dec. 31, her office said Friday.
Sanders first suspended the restrictions on Sept. 29, with the order initially set to expire at the end of October. The extension keeps the temporary policy in place for the remainder of the year as diesel prices remain elevated, according to the governor’s office.
“The adverse circumstances that existed on that date continue to exist today.”
Dyed diesel, commonly called red diesel, is generally intended for off-road equipment and is subject to different tax treatment from clear diesel. Farmers and loggers typically use it in tractors, combines, timber equipment and other machinery that does not travel on public highways.
How the fuel is taxed
The fuel is exempt from the federal highway tax and carries a lower state excise tax than clear diesel. Under ordinary Arkansas law, dyed diesel generally cannot be used in vehicles operating on highways because the tax treatment is tied to off-road use.
The governor’s action temporarily allows farmers and loggers to use their existing supplies of dyed diesel on highways. The extension applies through the end of December, according to the release from Sanders’ office.
- Sept. 29: Sanders initially suspended the highway-use restrictions through October.
- Friday: The governor extended the suspension through Dec. 31.
- Fuel covered: Dyed diesel, which has a lower state excise tax and is exempt from the federal highway tax.
The Arkansas action follows a federal move involving the same fuel. Earlier this month, President Donald Trump signed an executive order allowing the tax-free purchase of red-dyed diesel, the governor’s office said.
The extension is a temporary suspension of the state restrictions rather than a permanent change to the laws governing dyed diesel. Farmers and loggers may continue using the fuel on highways under the governor’s order until Dec. 31.
