Has the undyed diesel tax rate increased? Yes. Beginning July 1, 2017, the undyed diesel tax rate is increased to 21 cents. See important notice 17-08 for rate increases for subsequent years. May 10, 2017 19:26 Related articles What qualifies for a Tennessee agricultural exemption? Has the compressed natural gas tax rate increased? Has the undyed diesel tax rate increased? Should petroleum products be billed and reported in gross gallons or net gallons? Is there a minimum purchase requirement in order to qualify for the government exemption from petroleum taxes?