The Department of Revenue, in their relentless pursuit of more revenue, has told kerosene sellers they must prove the kerosene they sell is being used for residential purposes. Sellers contend this is impractical.
"They sent me an e-mail Nov. 16 saying we need to be charging sales tax on kerosene. Home heating fuel has never been taxable," Hunt said.
Carruthers also said he was not told that the state was going to start charging sales tax on kerosene. "The state should have notified their tax collecting agents, which is us."
To assure that the kerosene was intended for heating purposes, the state contends people should give pertinent information — name, what the kerosene will be used for, date, address and phone number. This would not be practical for a convenience store clerk, who is often busy with other customers, Carruthers said.
A letter from the Department of Revenue to Hunt states that since he has no records to show which kerosene sales were for residential use and which for commercial use, then his company owes taxes on 100 percent of its kerosene sales.
While some roofers use kerosene to heat tar pots and/or contractors use kerosene heaters to dry a building, the vast majority of the sales are for residential use, Hunt said. Most of the sales occur in the colder months.
Blount County Rep. Doug Overbey is not happy with the Department of Revenue's interpretation of the bill.
Overbey said the legislature was told the section of the bill in question regarded "taxable sales applied only to those sales or propane not used for home-heating purposes. But now the interpretation by the department is that kerosene used for home heating is taxable and I believe they need to end it, consistent with the department's explanation of this provision provided to the legislature."
Overbey added that the legislature was not told that sales tax would be placed on kerosene sold for home heating and the bill does not state that. Had that been the case, Overbey said he would not have approved that particular section of the bill.
"I'm asking respectfully that the department rescind its current interpretation and not tax kerosene used as home heating fuel. It boils down to this: a large amount of the kerosene sold in my district during the winter months is for home-heating purposes. It is neither fair nor right to hit our citizens' wallets this hard this time of year," Overbey concluded.