To be Taxed or Not to be Taxed?
by Tim Fesko
I was recently reading a letter to the Editor in a local newspaper titled “Propane Sales Tax?” by Alice Suszynski, a local in June Lake. Alice described how she recently found out that purchasing Propane Gas for your primary residence is not taxable. Yes you read that right, the law states that the purchase of Propane Gas for use in your primary residence (no vacation homes) is not subject to the State Sales Tax.
After reading Alice’s entire letter, I sat back and was dismayed. I thought “Is this really true?” And if it is true, then how come our local propane companies are not telling us about this?
Upon returning home, I started to research the Internet and low and behold everything that Alice wrote about was indeed TRUE! It turns out that the exemption of sales tax on Propane Gas was passed in April of 2001. Yes that’s right, it was signed into law in 2001 and it seems that practically no one over here in the Eastern Sierra has ever heard about it.
According to Alice, when she contacted her propane company and asked why they have not informed the public for the last 11 years, their answer was “it is our company policy not to tell our customers about this exemption”. I for one am horrified that any company would not inform their customers that they could save money. What would the motive be for any company not to inform their customers?
I think a question for our propane companies is where did the money go that they have been collecting for sales tax? By law any sales tax collected has to be passed onto the State. So a valid question is did they pass the collected tax along to the State or did they keep it which would be against the law. Or if they did indeed pass it along to the State was it collected under false pretenses? Did they have an obligation to inform their customers and would the propane company be liable to return any amounts collected to its customers?
I reside in the Antelope Valley where we have a large number of elderly that live on fixed incomes. In fact, I know many elderly that have had to apply for a special government programs in order to help pay for propane, just so that they could stay warm during the winters.
The idea that any company would not inform their customers, especially our elderly, of an exemption like this really pushes my button! I am beyond the point of anger. I feel that we the residents of Mono County have been deceived and for what reason?
I’m sure many of you are asking the question “what can I do now to get this exemption on the Propane Gas we purchase for our primary home?”. The answer is, contact your propane company immediately. Tell them that you want the exemption from sales tax on all of your future purchases of Propane Gas per State Law AB426. There is a very simple form they may require you to fill out. If they say they do not have the form, tell them to get form BOE-203-C from the Board of Equalization’s website at www.boe.ca.gov.
Alice was lucky enough to receive a partial refund on some of the sales taxes that she had paid in the past. Of course she had to fight for this. I’m not sure how successful any of us will be in getting our refunds. However, you might as well ask, because all they can say is No. However, the one thing they can not say No to is you not having to pay Sales Tax on Propane Gas for your primary residence. Contact your propane company today and ask for this exemption!