39-26-102(21)
(1)
Sales of
Energy.
(a)
Energy Sale or Use
Prior to March 1, 2010 and After June 30, 2012. The sale, use,
storage, or consumption of electricity, coal, gas, fuel oil, steam, nuclear
fuel, and coke occurring before March 1, 2010 or after June 30, 2012 are exempt
from sales and use tax when used for any of the following purposes: processing,
manufacturing, mining (including oil and gas exploration and production),
refining, irrigation, construction, telegraph, telephone and radio
communication, street and railroad transportation services, and all industrial
uses. See Special Rule 19 "Gas and Electric Services" for acceptable methods of
determining the credit allowed for gas and electricity used in restaurant
operations.
(b)
Energy Sale
and Use Between March 1, 2010 and June 30, 2012. The exemption from
state sales and use tax set forth in subsection (1)(a), above, is suspended for
such sale, use, storage, or consumption occurring on or after March 1, 2010 and
before July 1, 2012, and sales and use tax are due thereon, unless otherwise
exempt pursuant to other statutes (e.g., sale to, or use of energy by,
charitable entities, schools, and governmental entities). An energy utility
whose billing cycle includes exempt sales before and taxable sales after March
1 shall prorate the tax for such periods.
(i)
Exceptions. The suspension of the tax exemption described in
subsection 1(a),
above, shall not apply to purchases of:
(1) Diesel fuel for off-road use,
(2) Electricity, coal, gas, fuel oil, steam,
coke, or nuclear fuel used for agricultural purposes,
(3) Coal, gas, fuel oil, steam, coke, or
nuclear fuel used for generation of electricity,
(4) Electricity, coal, gas, fuel oil, steam,
coke, or nuclear fuel used by railroads.
(ii)
Application of Exception to
Suspension of Exemption. HB 10-1190, which suspended the exemption
described in (1)(a), above, excluded from the suspension the applications
described in (1)(b)(i)(1)-(4). In these areas, the exemption continues to exist
as described in (1)(a). Thus, HB 10-1190 neither expanded nor limited the
exemption in these specific areas. Off-road, agricultural, electricity
generation, and railroad uses must still qualify for the exemption as described
in 39-26-102(21)(a) C.R.S. and as further described in (1)(a) of this rule.
(iii)
State-Administered
Cities, Counties, and Special Districts. Energy sales described in
subsection 102(21) made on or after March 1, 2010 remain exempt from
state-administered city, county, and special district sales and use
taxes.
(c)
Energy Sale and Use for Residential Use. The sale, use,
storage, or consumption of electricity, coal, wood, gas, fuel oil, or coke sold
for residential use is exempt from tax regardless of whether such sale, use,
storage, or consumption occurs before or after March 1, 2010.
(2)
Newspaper Publishers and
Commercial Printers. Vendors must collect the tax on all sales of
equipment and materials to publishers of newspapers and commercial printers,
except on sales of newsprint and printer's ink, which are expressly exempt as
wholesale sales. "Newsprint" is defined as cheap, machine-finished paper,
chiefly from wood pulp, and used mostly for newspapers.
(3)
Definitions.
(a) "Agricultural purposes" means the
production of agricultural commodities as defined in 39-26-102(1)
C.R.S.
(b) "Gas" means natural or
manufactured gas used in the production of energy or used in industry to heat
greenhouses, used by industrial plants engaged in manufacturing or used for
melting metal in foundries, for firing brick kilns, or for other industrial
uses.
(c) "Industrial uses" means
the use of electricity, coal, gas, fuel oil, coke, or nuclear fuel in a
continuing business activity of manufacturing or producing tangible personal
property or services as set forth in C.R.S.
39-26-104(1)(c)
and (d.1).
Notes
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