Confused? TN state sales tax on kerosene raises questions

KNOXVILLE (WVLT) -- If you've bought any kerosene lately, you may have been asked to pay state sales tax for the first time.

It's a tax that the legislature never voted for.

If you think that sounds confusing, you're not alone.

We sent Volunteer TV's Rob Pratt to investigate.

After receiving several calls from viewers, we first thought some stores might be trying to charge an illegal tax.

But we learned that stores may also be victims of confusion created by a bureaucratic misinterpretation of the law.

Pam Phillips uses kerosene to keep her family warm, but she's hot about paying taxes for it.

Phillips says, "I just don't think it's right. I don't think that you should have to pay an additional tax just in order to heat your home to keep the pipes from busting. I just think that's unfair."

Kerosene bought at pumps, for home use, is not supposed to be taxed.

But Phillips says at least one area store asked her to pay it.

Her mother, who lives' on a fixed income, ran into the same problem.

Judy Smith says, "I don't think they should be allowed to tax it."

Doug Overbey says, "If we had been told that this bill in any shape, form, or fashion applied to kerosene used by people to heat their homes, I would not have voted for it."

State Representative Doug Overbey of Blount County studied the issue when a a bill to tax propane for grills came up last spring.

He says a 180-page summary of that bill did *not contain a single word about taxing kerosene. He was shocked last month when he learned that a state audit forced an oil company in his district to pay over $30,000 in taxes because they could not document which sales were for home heating uses.

He confronted the commissioner of revenue, who issued a new interpretation of the law, making it clear that kerosene for home use is not to be taxed."

Doug Overbey says, "What I have done is already taken steps to do is have legislation drafted to correct. finally, this incorrect interpretation and make it retroactive to July of 2007."

Representative Overbey expects to introduce that legislation when the 2008 session begins this week.

For now, those who sell kerosene should *not ask you to pay state sales tax.

If you want to see the state's latest attempt to clear up the confusion, click on the link below.


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  • by judy Location: altamont, tn on Feb 15, 2008 at 05:52 PM
    My family is having to heat with kerosene this year and the store that we buy it from is charging extra tax on it. Clearly, on the pump it says nontaxeable, twice. When I have mentioned it to them, they start puting notes on the pump that say "per mngmnt". Other local stores don't charge extra tax and they're kerosene is .50 cents cheaper. How are these people getting away with this?
  • by Mike Location: Maryville on Jan 8, 2008 at 02:24 AM
    Why do big oil and gov.Just keep pushing the people that are already down ,Deeper.It just don`t make any Since.Let them just go ahead and crush all the real good people that can`t afford high class heating and other stuff.I have fought in war for this country and I am not that proud of the way we do our low income people.It is Sad.
  • by greg Location: harriman,tn on Jan 7, 2008 at 06:10 PM
    i just caught the information on tax for kerosene im against it i called nashville and i still got stuck paying it

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