President Donald Trump issued an executive order on October 5 that temporarily suspends federal penalties for using dyed diesel fuel on public highways. The relief measures remain in effect through December 31.
The directive instructs the Treasury Department to evaluate whether certain federal fuel taxes can be deferred or forgiven. However, the order does not automatically erase tax liabilities; payments may only be postponed rather than eliminated.
In response, Idaho Governor Brad Little ordered a 30-day suspension of dyed-diesel inspections four days after the federal announcement. The Idaho State Police and the Idaho Transportation Department have halted these checks for the duration of the suspension period.
State law continues to restrict the use of dyed diesel in vehicles operating on public highways. Governor Little’s administrative order does not alter existing statutes. Furthermore, Idaho law includes an exception for vehicles permitted to use dyed diesel under federal regulations, but it remains unclear whether Trump’s temporary relief qualifies under that provision.
Dyed diesel contains red dye to indicate it is sold for uses exempt from highway fuel taxes. Farmers, ranchers, and other businesses using thousands of gallons of the fuel could see substantial savings if penalties are waived or deferred.
Vehicle owners face mechanical risks if they accidentally put dyed diesel into licensed vehicles. Residual red dye can remain in a vehicle’s fuel system for months after switching back to clear diesel. The Idaho Tax Commission recommends draining the fuel, replacing filters, cleaning tanks and lines, refilling with clear diesel, and paying applicable taxes if contamination occurs.
The Idaho Legislature will not return for its regular session until January, which is after the federal relief period expires. Lawmakers may need to address any lingering legal ambiguities regarding state enforcement and tax obligations when they reconvene.