NY Tribunal Rejects Fuel Tax Refund For Religious Group
By Abraham Gross · July 16, 2020, 4:41 PM EDT
A New York nonprofit religious organization can't claim a tax refund for dyed diesel fuel purchases it made related to the construction of its world headquarters in the state, the New York Tax Appeals Tribunal ruled Thursday.
In its consolidated decision, the tribunal upheld an administrative law judge ruling that denied Watchtower Bible and Tract Society of New York's 2015 claim for a refund of tax on petroleum businesses, saying that the organization couldn't claim the exemption for dyed diesel sold to nonprofits. The petroleum businesses tax is passed through to purchasers as part of the selling price.
The judge said the organization was disqualified from the exemption because the fuel trucks that received the fuel from suppliers and subsequently fueled the construction equipment were also capable of fueling nonexempt motor vehicles, even if the organization did not allow it.
The organization argued that interpretation was too narrow and would make it impossible to claim the exemption. The tribunal, however, agreed with the judge's interpretation of the limitation and said the exemption could still be claimed if a supplier directly fueled the equipment instead of depositing the fuel into an intermediary owned by the nonprofit, such as a fuel truck.
As a result, the tribunal upheld the denial of a $67,000 refund for the period of Sept. 1, 2013, through Dec. 31, 2014, a $65,000 refund for the 2015 calendar year and an $11,000 refund for 2016.
The case is In the Matter of Watchtower Bible and Tract Society of New York Inc., case numbers 827916 and 828547, in the New York State Tax Appeals Tribunal.
--Editing by Robert Rudinger.