A final decision by the Administrative Law Judge (ALJ) of the State Office of Administrative Hearings (SOAH) to not grant a Texas-based oil and gas pipeline and storage company a US $2.4 million tax refund on bunkers delivered to international vessels at a Texas port was due to rules implemented by the Texas Motor Fuels Tax Code.
A Texas Comptroller of Public Accounts spokesperson Wednesday summarised and pointed out to Manifold Times fuel oil in the U.S. being categorised into various numbers:
“Fuel Oil numbers 1-4 are subject to the Motor Fuels Tax Code but Numbers 5-6, if clearly identified as bunker fuel on the sales invoice, would be subject to sales tax licensing and rules in the Texas Sales & Use Tax Code,” he told Manifold Times.
The unidentified tax claimant was selling bunker fuel to ships from various countries and filed franchise tax refund claims for the reporting years of 2011 through 2013 in 2015, according to the hearing document seen by Manifold Times.
The requested tax refund for fuel oil sales from a Texas port to a foreign registered ship are as follows:
|Report Year||Requested Refund|
The Texas Comptroller of Public Accounts (Comptroller) denied the requests because they did not include the necessary documentation.
The claimant later requested a refund hearing contending that its Texas receipts were overstated because they include sales of fuel oil that was used by foreign flagged vessels.
“In the instant matter, Claimant contends its original franchise tax returns erroneously included receipts from the sale of bunker fuel oil to foreign-registered vessels. It argues that the receipts at issue are not Texas receipts because the buyers’ business consisted of transporting goods and passengers across oceans but never between U.S. ports,” said ALJ Victor Simonds.
“It states that, though the product at issue was delivered to vessels that were in Texas, the buyers were not ‘in this state’ because they were not operating in Texas since the buyers could not use or sell the bunker fuel oil in Texas.
“Based on the plain meaning of the apportioning statutes, if tangible personal property is delivered or shipped to a buyer in this state, then the receipt is a Texas receipt.
“It is also clear that the Legislature anticipated that, in some instances, the delivery point and FOB point might not be the same. When they are not, it is the point of delivery that is determinative for apportionment purposes, not the FOB point. The statute does not stand for the proposition that the point of delivery should be disregarded when the FOB and delivery points are the same.
“Claimant delivered its product to purchasers that were in Texas ports and waters; i.e., the bunker fuel oil was purchased by and delivered to buyers that were in this state. Therefore, based on the plain meaning of the statute, Staff’s refund denials were proper because the receipts at issue were Texas receipts.”
The full Comptroller’s decision can be found here.
Published: 13 February, 2019
IBIA Asia, ABIS, sources from Singapore’s bunkering and surveying companies, and an industry veteran share with Manifold Times the issues expected from MPA’s latest Covid-19 measures.
The top three positive movers in the 2020 bunker supplier list are Hong Lam Fuels Pte Ltd (+13); Chevron Singapore Pte Ltd (+12); and SK Energy International (+8), according to MPA list.
‘We will operate in the Singapore bunkering market from the Tokyo, with support from local staff at Sumitomo Corporation Singapore,’ source tells Manifold Times.
Changes include abolishing advance declaration of bunkers as dangerous cargo, reducing pilotage fees on vessels receiving bunkers, and a ‘whitelist’ system for bunker tankers.
Claim relates to deliveries of MGO to the vessels Pacific Diligence, Pacific Valkyrie, Pacific Defiance, Crest Alpha 1, and Pacific Warlock between March 2020 to April 2020.
3,490 mt of LSFO from Itochu Enex was lifted at Universal Terminal; the same bunker stem was bought by Global Marine Logistics and delivered by bunker tanker Juma to receiving vessel Kirana Nawa.
15 Jan 2021