https://www.law360.com/tax-authority/articles/1292663/ny-tribunal-rejects-fuel-tax-refund-for-religious-group
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.