The Minnesota Department of Revenue and the Minnesota Department of Public Service have released a study finding that electric and natural gas utilities pay higher taxes in certain categories than in other states in the region, which could put Minnesota at a disadvantage as the utility industry becomes increasingly competitive.
The study, mandated by the 1996 state Legislature, finds that in addition to paying high real estate taxes, utilities also pay personal property taxes on machinery and equipment. However, in 1996, Gov. Carlson signed a law granting reductions in the personal property taxes paid on machinery and equipment installed in new or existing electric power generation facilities that meet certain efficiency standards.
"We can expect that in the near future consumers will be able to choose their utility company," said Revenue Commissioner Jim Girard. "With the arrival of competitive pricing, issues raised by Minnesota's current tax structure will become much more
important." (em LB t
Lori A. Burkhart is associate legal editor, and Joseph F. Schuler, Jr. associate editor, of PUBLIC UTILITIES FORTNIGHTLY.
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