Ruling: Co-op must pay tax on purchase of coal, natural gas

April 1, 2017
Shale Play

PHOENIX (AP) - A court ruling says a southeastern Arizona power cooperative must pay tax on its purchases of coal and natural gas from out-of-state suppliers for its generating plant in Cochise County.

The Arizona Court of Appeals decision Tuesday upholds a trial judge's ruling for the state Department of Revenue in a case involving the Arizona Electric Power Cooperative Inc.

The co-op paid a form of sales tax on its coal and natural gas purchases but later filed refund claims for over $7 million. The department denied the claims.

The co-op argued that its purchases were exempt the coal and gas were for resale as electricity, but the appeals court said the coal and gas are used and consumed as fuel and not exempt from taxation.



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