The gold rush is on! The rush for sales tax gold, that is. For those involved in the mining of natural gas, a significant opportunity exists for a sales tax refund under the Pennsylvania Sales Tax Mining Exemption. The Mining Exemption provides an exemption to Pennsylvania’s sales tax for certain equipment and services used in the extraction of natural gas. Because many vendors are wrongly applying sales tax to items covered by the Mining Exemption, it is important for companies that mine the Marcellus Shale region in Pennsylvania to closely examine their purchases for possible refunds under the Mining Exemption.
What Is Exempt?
The Pennsylvania Department of Revenue has defined the extraction of natural gas as an excluded mining activity. Pennsylvania law defines mining to include exploration, drilling, extracting and refining of natural resources such as natural gas. The actual mining process is considered to begin with the drilling of the wellbore and ending with last physical change of the gas prior to being sold and transferred. Continue reading