2006 Regular Session
To: Ways and Means
By: Representative Watson
AN ACT TO AMEND SECTION 27-65-15, MISSISSIPPI CODE OF 1972, TO MAKE IT CLEAR THAT SALES OF COAL AND LIGNITE USED AS FUEL TO PRODUCE ELECTRIC POWER BY A COMPANY PRIMARILY ENGAGED IN THE BUSINESS OF PRODUCING, GENERATING OR DISTRIBUTING ELECTRIC POWER FOR SALE ARE NOT TAXED UNDER THE MISSISSIPPI SALES TAX LAW; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-65-15, Mississippi Code of 1972, is amended as follows:
27-65-15. (1) Upon every person engaging or continuing within this state in the business of mining, quarrying, drilling or otherwise producing, or causing to be produced for sale, profit, or commercial use, limestone, sand, gravel, dirt, coal, lignite or other mineral or natural resource products, except timber, oil, natural gas and salt, there is hereby levied and assessed and shall be collected taxes as follows:
(a) Sales to consumers within this state shall be taxed under Section 27-65-17 or Section 27-65-19, as the case may be.
(b) Sales defined as wholesale or exempt, used by the producers as a component material of a contract taxable under Section 27-65-21, as a raw material of a manufactured product, or delivered outside this state, shall be taxed at seven percent (7%) of the gross proceeds of sales, exclusive of delivery charges, or value when converted to use, whichever is greater, but not to exceed Five Cents (5¢) per ton with respect to sand, gravel, dirt, clay or limestone.
(2) The sale of coal and lignite used as fuel to produce electric power by a company primarily engaged in the business of producing, generating or distributing electric power for sale, shall be exempt from the provisions of this section.
(3) The commission shall prescribe equitable and uniform rules for ascertaining value.
(4) All privilege taxes levied upon persons engaged in the production of natural resource products by this chapter shall be a lien upon all such products so produced and such lien shall be entitled to preference over all judgments, executions, encumbrances or liens, whensoever created. All persons to or through whom the title to such products pass shall be jointly and severally liable for such tax until the same is paid in full.
(5) The tax imposed in this section shall be collected by the commissioner from the person in charge of the production operations, and the commissioner is hereby authorized to make such investigations and inspections of the production operations, from time to time, as he may deem necessary for the purpose of ascertaining the correct amount of tax due.
SECTION 2. This act shall take effect and be in force from and after its passage.