North Carolina HB 3 (Session Law 2026-62): Relief at the Pump Gas Tax Holiday
North Carolina temporarily suspended its motor fuel excise tax from October 15 through November 30, 2026, to lower prices at the pump. The law also waives penalties for farmers using dyed diesel for agricultural purposes over the same period, and backfills lost highway revenue from the state's Savings Reserve. (Note: the enrolled text sets the holiday-period rate at 19.5 cents per gallon; the governor's office described it as suspending the 41-cent tax.)
| State | North Carolina |
|---|---|
| Type | State law |
| Number | HB 3 (SL 2026-62) |
| Dated | October 9, 2026 |
| Official source | Official text |
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The complete text of HB 3 (SL 2026-62) (North Carolina), reproduced from the official source. Government edicts are in the public domain.
GENERAL ASSEMBLY OF NORTH CAROLINA FIRST EXTRA SESSION 2026 HOUSE BILL 3 RATIFIED BILL
AN ACT TO TEMPORARILY SUSPEND THE MOTOR FUEL EXCISE TAX AND TO WAIVE THE PENALTY FOR IMPROPER USE OF DYED DIESEL FUEL BY FARMERS FOR AGRICULTURAL PURPOSES.
The General Assembly of North Carolina enacts:
MOTOR FUEL EXCISE TAX HOLIDAY
SECTION 1.(a) Definitions. – The following definitions apply in this act: (1) Excise tax. – The tax imposed under Article 36C of Chapter 105 of the General Statutes. (2) Excise tax holiday period. – The period beginning October 15, 2026, and ending November 30, 2026. (3) Secretary. – The Secretary of Revenue.
SECTION 1.(b) Suspension of Excise Tax Collection. – Notwithstanding Article 36C of Chapter 105 of the General Statutes, during the excise tax holiday period, a supplier is not liable for the excise tax on motor fuel removed from a terminal or imported into this State.
SECTION 1.(c) Supplier Notification and Reporting. – A supplier that removes motor fuel from a terminal or imports motor fuel into this State during the excise tax holiday period shall continue to file all returns and reports as required under Article 36C of Chapter 105 of the General Statutes during the excise tax holiday period, but shall not collect or pay the excise tax on the motor fuel.
SECTION 1.(d) Tax Rate. – (1) The excise tax rate is nineteen and one-half cents (19.5¢) per gallon during the excise tax holiday period. (2) A retailer of motor fuel is encouraged to reduce the sales price of motor fuel during the excise tax holiday period by an amount equal to the amount of the excise tax that would have otherwise been imposed on the motor fuel.
SECTION 1.(e) Funds Affected and Hold Harmless. – The Department of Revenue shall estimate the amount of excise tax revenue that would have been collected in the absence of the excise tax holiday established by this section and shall certify the amount to the State Controller as follows: (1) By April 15, 2027, the Department of Revenue shall estimate the amount of motor fuel excise tax revenue that would have been deposited in the Highway Fund in the absence of the excise tax holiday and certify the amount to the State Controller. The State Controller shall transfer the certified amount from the Savings Reserve to the Highway Fund in the 2027-2028 fiscal year. (2) By April 15, 2027, the Department of Revenue shall estimate the amount of motor fuel excise tax revenue that would have been deposited in the Highway Trust Fund in the absence of the excise tax holiday and certify the amount to the State Controller. The State Controller shall transfer the certified amount from the Savings Reserve to the Highway Trust Fund in the 2027-2028 fiscal year. (3) Notwithstanding subdivisions (1) and (2) of this subsection, the hold harmless transfer for excise taxes attributable to fuel used for wildlife resources activities shall be transferred to the Wildlife Resources Fund. The Department of Revenue shall consult with the Wildlife Resources Commission to identify the applicable revenue amount.
EXEMPTION FOR DYED DIESEL FUEL USED FOR AGRICULTURAL PURPOSES
SECTION 2. Temporary Waiver of Penalty. – Notwithstanding G.S. 105-449.121, no penalty shall be imposed for the unlawful or improper use of dyed diesel fuel if the use is for an agricultural purpose by a farmer during the period beginning October 15, 2026, and ending November 30, 2026. For purposes of this section, "farmer" has the same meaning as in G.S. 113-247(a)(2), and "agricultural purpose" means use in farming operations as defined by the Secretary.
SECTION 3. Nothing in this act shall be construed to affect the imposition or collection of the sales and use tax under Article 5 of Chapter 105 of the General Statutes.
SECTION 4. The Secretary shall notify affected taxpayers of the provisions of Sections 1, 2, or 3 of this act as soon as practicable when this act becomes law.
EFFECTIVE DATE
SECTION 5. Except as otherwise provided, this act is effective when it becomes law.
In the General Assembly read three times and ratified this the 7th day of October, 2026.
s/ Phil Berger President Pro Tempore of the Senate
s/ Mitchell S. Setzer Presiding Officer of the House of Representatives
s/ Josh Stein Governor
Approved 10:49 a.m. this 9th day of October, 2026
Source: North Carolina General Assembly, First Extra Session 2026, House Bill 3 (Session Law 2026-62). Bill page: https://www.ncleg.gov/BillLookup/2025E1/H3
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Frequently asked questions
What does North Carolina HB 3 (Session Law 2026-62): Relief at the Pump Gas Tax Holiday do?
North Carolina temporarily suspended its motor fuel excise tax from October 15 through November 30, 2026, to lower prices at the pump. The law also waives penalties for farmers using dyed diesel for agricultural purposes over the same period, and backfills lost highway revenue from the state's Savings Reserve. (Note: the enrolled text sets the holiday-period rate at 19.5 cents per gallon; the governor's office described it as suspending the 41-cent tax.) The full text is reproduced below so you can read exactly what it says.
When was HB 3 (SL 2026-62) issued, and when does it take effect?
It is dated October 9, 2026. Check the full text below for the exact effective-date language, since different sections can take effect on different dates.
Where can I read the official text?
The official source is linked on this page (https://www.ncleg.gov/BillLookup/2025E1/H3). The full text is also reproduced below for easy reading and searching.
Is there an audio version?
Yes. An AI-narrated audio version of the full text is embedded above.