Oklahoma Pipeline Company Appeals South Dakota Sales Tax Bill

A Tulsa, Okla.-based pipeline company is appealing a tax bill for services performed at its terminals in Sioux Falls and Watertown.

The Argus Leader reports that Magellan Midstream Partners is appealing more than $241,000 in back taxes on the fees it charges customers for injecting fuel additives. The company believes the services fall in the category of pipeline transportation, which is exempt from sales tax under South Dakota law.

But The Department of Revenue disagrees. It assessed a tax bill of more than $241,000 for September 2006 through January 2010, including about $51,000 in interest.

Magellan has filed an appeal in Minnehaha County Circuit Court after the South Dakota Office of Hearing Examiners denied the company's appeal in April.