Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2014
Sales and Use Tax Annotations
275.0000 GAS, ELECTRICITY AND WATER
(a) DELIVERY THROUGH MAINS, LINES OR PIPES
275.0175 Oxygen Sold via Pipes. Taxpayer owns and operates an oxygen production facility located on real property owned by a manufacturer of glass containers. The taxpayer produces oxygen and sells it in vapor form to the glass manufacturer via pipeline. The taxpayer owns a segment of the pipeline from the junction point to the glass manufacturer's building. Title to the oxygen furnished is transferred to the glass manufacturer at the junction point. The taxpayer meters the oxygen as it enters the pipeline on its way to the glass manufacturer's furnace.
In this case, the taxpayer is making sales of gaseous oxygen by delivering that oxygen to the purchaser via pipes. Such sales are exempt from sales tax under section 6353. 9/11/95.