According to the Office of the ND State Tax Commissioner, the use of dyed diesel fuel is not allowed for on-road use in licensed vehicles in North Dakota. Under ND law, the injection of red dye into diesel fuel indicates the fuel has not been subject to an excise tax. Instead, dyed diesel fuel is subject to the special fuel excise tax of $.04 per gallon.
Dyed diesel fuel is used for off-road, non-licensed equipment for farming or construction and is exempt from the per gallon fuel tax. Dyed fuel continues to be taxed at a different rate and is intended for off-road non-licensed vehicle use only.