42-6113. County excise tax on coal mining

(Conditionally Eff.)

A. A county excise tax is levied on the business of mining or producing for sale, profit or commercial use coal that has been mined or otherwise extracted within the boundaries of the county. The tax shall be levied and collected at the rate of .5 percent of the tax base, consisting of gross proceeds of sales or gross income derived from the business.

B. The gross proceeds of sales or gross income derived from sales described under section 42-5061, subsection A, paragraph 27 and subsection I, paragraph 2 shall be deducted from the tax base.

C. The tax base includes the value of the entire product mined or produced for sale, profit or commercial use in this state, regardless of the product's place of sale or of the fact that deliveries may be made to points outside this state. If the sale price of the product includes freight, the sale price shall be reduced by the actual freight paid by any person from the place of production to the place of delivery.

D. If a person engaging in business classified under the mining classification ships or transports all or part of the coal out of this state without making sale of the product, the value of the coal when transported out of this state and before it enters interstate commerce is included in the tax base, as determined according to rules adopted by the department for the purposes of the mining classification under section 42-5072.

E. A taxpayer that conducts a business subject to tax under this section may be considered to also be engaged in business classified under the retail classification pursuant to section 42-5061 to the extent the taxpayer's activities comprise business under the retail classification if the taxpayer pays state transaction privilege tax at the rate prescribed by section 42-5010. If the transaction is not subject to taxation under the state retail classification, the transaction shall be included in the tax base under this section, except for the transfer of title or possession of coal back and forth between an owner or operator of a power plant and a person that is responsible for refining coal if both of the following apply:

1. The transfer of title or possession of the coal is for the purpose of refining the coal.

2. The title or possession of the coal is transferred back to the owner or operator of the power plant after completion of the coal refining process. For the purposes of this paragraph, " coal refining process" means the application of a coal additive system that aids the reduction of power plant emissions during the combustion of coal and the treatment of flue gas.