Drilling Equipment Subject To Texas Sales Tax, Court Rules

Law360, New York (May 2, 2012, 1:32 PM EDT) -- A Texas judge on Monday ruled that oil and gas extraction equipment is subject to state sales and use taxes, nixing a bid by oil and gas company Southwest Royalties Inc. to claim the equipment was exempt, in a reversal of the judge’s own earlier ruling.

Travis County Judge John K. Dietz ruled that Southwest Royalties failed to establish that its equipment qualified for an exemption under the Texas Tax Code and that the company was therefore not entitled to a refund. The judgment reverses an...
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