Sunday, June 29, 2008

In TN you can Tax Rock but not Dirt-is Clay dirt?

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General Shale hopes to harvest clay from northern Rhea County to make bricks. Rhea County hopes to be able to tax General Shale for the clay it removes like it taxes the rock quarries. General Shale would rather not pay the tax. Both positions are understandable. The question is, is clay a form of rock?

The Tennessee General Assembly passed a law in 1984 empowering counties to charge a tax of up to 15 cents per ton on gravel, sand, sandstone, chert and limestone removed for commercial purposes. Rhea County adopted that act in 1995, and since then local quarries have been paying the tax.

Both General Shale and the county have been mature in their discussions over the mineral severance tax, and both parties have indicated they will abide by a state attorney general’s opinion on the matter, which the county will likely request next month