Mineral Oil Tax on vehicle gas (MOT VG)


Natural gas supplied to consumers is liable to Natural Gas Carbon Tax (NGCT). Up to 31 December 2016, this included natural gas that was supplied for use as fuel for motor vehicles. Section 38 of Finance Act 2016 introduced a change to the taxation of natural gas used as fuel in a motor vehicle.

From 1 January 2017, natural gas and biogas that are supplied for use as fuel in a motor vehicle are subject to Mineral Oil Tax (MOT). Natural gas and biogas supplied for such use are called ‘vehicle gas’.  From 1 January 2017 NGCT no longer applies to supplies of vehicle gas and is replaced by MOT.

Natural gas may be liquefied as Liquefied Natural Gas (LNG) or compressed as Compressed Natural Gas (CNG) for storage and transportation. MOT applies to all vehicle gas supplies regardless of the storage or transportation form used.

It should be noted that Liquefied Petroleum Gas (LPG) is not the same as vehicle gas. LPG is a mineral oil, whereas vehicle gas is either natural gas or biogas.

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