1. (a)

   1. (1) The gross receipts or gross proceeds derived from sales of motor fuel or special motor fuel are exempt from the tax if the motor fuel tax or special motor fuel tax has been paid to the State of Arkansas.
   2. (2) The gross receipts or gross proceeds derived from sales of fuel oil, motor oil, and lubricants are subject to tax.
2. (b) The gross receipts or gross proceeds derived from sales of unprocessed crude oil are exempt from the tax.
3. (c) The gross receipts or gross proceeds derived from the sale of motor fuel or special motor fuel to the owners or operators of motor buses operated on designated streets according to regular schedule, under municipal franchise, and which are used for municipal transportation purposes are exempt from the tax.

4. (d)

   1. (1) The gross receipts or gross proceeds derived from sales of special fuel or petroleum products for consumption by vessels, barges, other commercial watercraft, and railroads are exempt from the tax.
   2. (2) For purposes of this subsection, the term “vessel” shall mean and describe any motor driven watercraft used for commercial purposes for the transportation of tangible property or persons on the rivers, lakes, and navigable streams of Arkansas.
5. (e) That portion of the gross receipts or gross proceeds derived from the sale of automobile parts that constitute “core charges” that are received for the purpose of securing a trade-in for the article purchased is exempt from the tax except that when the article is not traded in, then the tax is due on the “core charge”. Example 1: If a customer purchases a new battery for forty dollars ($40.00) plus a core charge of eight dollars ($8.00) and returns a used core for eight dollars ($8.00), tax would be due only on the forty-dollar purchase price because the core was traded in or returned. Example 2: If a customer purchases a new battery for forty dollars ($40.00) plus a core charge of eight dollars ($8.00) with no core traded in, tax would be due on the total consideration of forty-eight dollars ($48.00).

Codification Notes: This section as promulgated prior to codification into the Code of Arkansas Rules contained a footnote as follows: "Source: Ark. Code Ann. §§ 26-52-401(11), (23), and (26); 26-52-417"