Court Opinion

ID: 9623777
Source: CourtListenerOpinion
Date Created: 2023-08-22 06:43:02.287376+00
Date Added: 2024-06-11T18:05:34.807733
License: Public Domain

Schroeder, C.J.,
dissenting: The Kansas Board of Tax Appeals properly granted a reasonable and bona fide deduction for basic sediment and water, pursuant to statutory authorization in K.S.A. 1983 Supp. 79-4217(a), when it determined basic sediment and *460water was not taxable under the Kansas Mineral Severance Tax Act, K.S.A. 1983 Supp. 79-4216 et seq.
The provisions of K.S.A. 1983 Supp. 79-4217(a) impose a mineral severance tax from and after May 1, 1983, on oil and other minerals, extracted from the earth for sale, on the gross value of each barrel of oil. The statute then reads in part:
“The rate of such tax shall be 8% of the gross value of all oil or gas severed from the earth or water in this state and subject to the tax imposed under this act. . . . For the purposes of the tax imposed hereunder the amount of oil or gas produced shall be measured or determined: (1) in the case of oil, by tank tables compiled to show 100% of the full capacity of tanks without deduction for overage or losses in handling; allowance for any reasonable and bona fide deduction for basic sediment and water, and for correction of temperature to 60 degrees Fahrenheit will be allowed.” (Emphasis added.)
The fact that the Director of Taxation does not follow the statutory mandate in determining the quantity of oil severed from the earth is immaterial. An erroneous method employed to impose and assess the tax should not be a basis for the Supreme Court to ignore the statute. Here, the Supreme Court in substance has rewritten the severance tax statute. The provisions of K.S.A. 1983 Supp. 79-4217(b) enumerating the exemptions are not applicable. The Board of Tax Appeals, having reached the correct decision under the Kansas Severance Tax statute, should not be reversed for having cited the wrong section of the statute. It properly considered the entire statute in ascertaining the legislative intent.
It is respectfully submitted the Kansas Board of Tax Appeals made the correct decision based on the facts in this case.