Can an employer deduct fuel reimbursement from your gross wages?

I worked as an Emergency Roadside Technician using my own vehicle. I was paid $14 per call completed and responsible for my own fuel and vehicle maintenance. The employer had me turn in my fuel receipts every week and would then deduct them from my gross pay so if for example I had completed 10 calls that week I would have made $140 in gross pay...if I turned in $70 worth of gas receipts, the employer then said I was reimbursed for $70 worth of gas on my check and my taxable earnings were $70. To me he was limiting his tax liabilites by reporting my wages as less than what I was really making. Is my thought process wrong? I was terminated shortly after complaining that this method was not kosher.