Oral Arguments are happening now.View them on the web or via Mobile App on iPhone / iPad or Android (4.0+).

You are here

Kerford Limestone Co. v. Department of Revenue

Printer-friendly versionPrinter-friendly version
Date: 
Tuesday, November 5, 2013

S-13-0035, Kerford Limestone Co. (Cross-Appellant) v. Nebraska Department of Revenue, a Nebraska Administrative Agency, and Douglas Ewald, in his capacity as State Tax Commissioner for the State of Nebraska (Appellants)

Lancaster County, Judge Stephanie F. Stacy

Attorneys: Shannon L. Doering, Luke Vavricek (Cross-Appellant) --- L. Jay Bartel (Attorney General’s Office)

Civil: Deficiency Assessment; Consumer’s Use Tax

Proceedings below: The Tax Commissioner found that the motor grader purchased and owned by Kerford’s limestone operation did not qualify for exemption from use tax as manufacturing machinery or equipment. Kerford appealed to the district court. The district court reversed the Tax Commissioner’s finding. Both parties filed Petitions to Bypass the Court of Appeals and both were granted by the Nebraska Supreme Court.

Issues: l. The district court erred in finding that the Department's interpretation of the exemption from sales and use tax for manufacturing machinery and equipment reflected in Revenue Ruling l-05-1, requiring that, if machinery and equipment has uses in addition to a manufacturing use, the manufacturing use must be greater than 50 percent to qualify for the exemption, was invalid because it impermissibly narrowed the scope of the exemption. 2. The district court erred and abused its discretion by remanding to the Department for consideration of whether use of the motor grader to maintain inventory stockpiles qualified the motor grader as exempt manufacturing machinery and equipment because remand following reversal based on its erroneous conclusion that Revenue Ruling 1-05-1 was invalid was not authorized under Neb. Rev. Stat. § 84-917(6)(b) (Cum. Supp. 2012). 3. The District Court erred in ordering the matter remanded to the Department because sufficient record evidence established that the use of the motor grader to clean and maintain inventory stockpiles did not qualify the motor grader for the manufacturing machinery and equipment exemption under either Neb. Rev, Stat. § 77-2701.47 (l)(b) or 77-2701.47(l)(d) (2009).

Cross-Appeal: The district court erred in (1) giving deference to the Department’s interpretation of Neb. Rev. Stat. § 77-2701.47; (2) limiting Neb. Rev. Stat. § 77-2701.47 by incorrectly construing the same in a manner plainly inconsistent with the statutory language.

 

This page was last modified on Tuesday, November 5, 2013