Opinion ID: 1036292
Heading Depth: 4
Heading Rank: 1

Heading: Nature of Nameplate

Text: Capacity Tax [3-6] An excise tax is a tax imposed on the manufacture, sale, or use of goods or on an occupation or activity, and is measured by the extent to which a privilege is exercised by the taxpayer, without regard to the nature or value of the taxpayer’s assets.14 An excise tax is imposed upon the performance of an act.15 We have also stated that an excise tax includes 13 Kiplinger v. Nebraska Dept. of Nat. Resources, 282 Neb. 237, 803 N.W.2d 28 (2011). 14 Anthony, Inc. v. City of Omaha, 283 Neb. 868, 813 N.W.2d 467 (2012). 15 Id. Nebraska Advance Sheets BANKS v. HEINEMAN 397 Cite as 286 Neb. 390 taxes sometimes designated by statute or referred to as “privilege taxes,” “license taxes,” “occupation taxes,” and “business taxes.”16 In contrast, a property tax is levied on real or personal property, with the amount of the tax usually dependent upon the value of the property.17 The State officials argue that the nameplate capacity tax is an excise tax because it is measured by the productive activity or capacity of a wind generation facility. But the Knox Countians counter that it is not an excise tax because it is not imposed upon an activity, but instead is imposed upon the capacity to generate electricity, whether the equipment is used or not. The Knox Countians contend that because it does not matter whether the equipment is used, the tax is similar to a tax on personal property. But at the same time, they contend that the nameplate capacity tax “does not replace personal property taxes.”18 We addressed a similar issue in Kiplinger. There, the tax at issue was designated as an “occupation tax” and was imposed on the “‘activity of irrigation.’”19 The landowners on whom the tax was imposed argued it was actually a property tax in disguise and as such was improperly imposed for a state purpose. In rejecting this argument, we noted that the tax was not a property tax in part because it was “not dependent upon the value of the land being taxed.”20 Similarly, it is clear that the nameplate capacity tax here is not dependent upon the value of the wind turbines and other equipment used to generate electricity. Instead, it is generally imposed on the privilege of owning wind generation facilities in Nebraska and is not measured by the value of those assets. For these reasons, we agree with the district court that it is an excise tax. 16 State v. Galyen, 221 Neb. 497, 378 N.W.2d 182 (1985). 17 Kiplinger, supra note 13. 18 Brief for appellees at 30. 19 Kiplinger, supra note 13, 282 Neb. at 243, 803 N.W.2d at 36, quoting Neb. Rev. Stat. § 2-3226.05 (Cum. Supp. 2008). 20 Id. at 251, 803 N.W.2d at 41. Nebraska Advance Sheets 398 286 NEBRASKA REPORTS