+ OMB Circular A-123 (Appendix B): Improving ... - The White House

11.4 How are state and local taxes recovered for the fleet card (except DoD)?
The charge card vendor issuing the fleet card should be contractually required to provide
information on a regular basis to the Federal agency owning/commercially leasing the
conveyance or fueled appliance, which includes, but is not limited to, identification of the sites
within a state, where expenditures occurred, specific merchant, and dollar amount, and gallons of
fuel purchased.
The Federal agency must identify the appropriate entity within each state that they must work
with in the tax recovery process, the address, and reporting requirements of that entity. In the
case of vehicles operated by a Federal agency that are not owned/commercially leased by that
agency but are leased by the agency (including leased by DoD) from GSA, GSA will receive the
above information from the charge card vendor and pursue the state and local taxes recovery.
11.5 How must the recovered state and local taxes be used for the fleet card?
Tax monies recovered are returned to the appropriation from which the commensurate
expenditure was made. While such monies can be used for any legitimate expenditure from that
appropriation, consideration should be given to applying the monies to the same type expenditure
that generated the recovered taxes; e.g., fuel, maintenance.
11.6 How are state and local taxes recovered for the DoD fleet card?
There are two methods of recovery available:
• For most transactions, the tax is effectively backed out before the fleet card vendor invoices
DoD. The oil company files with the state to recover the tax based on its sale to DoD. The
oil company credits the fleet charge card vendor and the credit is to be passed to DoD by
backing out the tax before invoicing DoD. There are some independent retailers who are not
associated with an oil company that do not back-out the tax. In those instances, DoD files
with the state directly for tax recovery. There are also the states where DoD has to go to the
oil company to file for a refund.
• In states where the oil company is not required to file for a credit with the state, the Defense
Finance and Accounting Service (DFAS) files for the tax refund based on tax payment details
provided by the charge card vendor, as well as information calculated by the DoD.
11.7 How must the recovered state and local tax monies from the DoD fleet card be used?
Recovered tax funds are returned to the working capital fund.
Appendix B
OMB Circular A-123
(Revised January 2009)