LAKELAND - Fuel sellers are positive about proposed changes to the way fuel for farm and other unlicensed off-road equipment is sold in Alberta.
Currently, agricultural producers receiving the Alberta Farm Fuel Benefit and individuals or businesses with Tax Exempt Fuel User certificates can purchase marked gasoline and diesel, which is sold at a “partially exempt tax rate of four cents per litre.” The fuel is dyed red to differentiate it from clear gasoline and diesel.
According to information from the province, they are not changing the fuel tax exemption rate but are considering eliminating the use of dye and would provide the tax exemption on clear fuel instead. They have launched an online survey to collect feedback from farmers and industry stakeholders until Aug. 31.
According to Kory Kralkay, the CEO of Cornerstone Co-op, which sells both clear and dyed fuel the proposed change is one they have advocated for in previous years.
“At a high level, in general, we're happy to see that this process is being reviewed. We think it's outdated and we can really simplify things if we got rid of it,” said Kralkay.
He said he expected it would change their cash flow somewhat as they would have to pay the full tax on their bulk orders of clear gasoline and diesel and then be reimbursed after selling it to the end user, but “I think it'll be offset by the operational efficiency of not having to deliver four products.”
Currently the trucks which deliver farm fuel have multiple compartments, each carrying a different type of fuel. Clear gas or diesel cannot be substituted for marked, meaning sometimes trucks have to return to the bulk station before they are fully empty.
UFA is also very in favour of the proposed change. According to Nick Harsulla, senior manager of Government Relations, in addition to the significant infrastructure savings from only needing two tanks instead of four at their fuel locations, it also reduces the environmental and safety concerns around spills.
“If you’re not dealing with multiple types of fuel, there’s less risk of spillage,” said Harsulla.
According to Harsulla, UFA sold approximately 1.35 billion litres of fuel provincewide in 2024, with a significant portion of that being marked gasoline and diesel.
“Our members also see it beneficial, just for the simple fact that it reduces their costs for their on-farm storage. And also, farmers would rather run their machinery on clean diesel rather than the dyed component,” said Harsulla.
Marc Caouette of Caouette and Sons Implements, which sells tractors and other machinery in St. Paul, said he had not heard much from his customers about the proposed changes yet.
“Sometimes I have customers that grumble about the dye. They say it’s not good for their engines. I don’t know if there’s ever been tests on it, but some farmers swear by it,” said Caouette.
