Steve Moore, a partner in our Austin office, was quoted in a June 20, 2016 Law360 article titled, “Hope Remains For Texas Drilling Tax Breaks After Court Loss.”

The Texas Supreme Court recently ruled that certain equipment used for oil and gas drilling would not be getting tax breaks, thus saving the state billions of dollars in refund dollars. This has seemingly caused quite a stir in the energy industry, bringing up a debate about what constitutes a piece of drilling equipment to be exempt. The rule currently is that the equipment is covered if it is manufactures, processes, or fabricates something, which is not an easy distinction to make in the oil and gas industry.

“It all boils down to whether you can prove the equipment causes a direct, physical change to the product you’re planning to sell,” Steve said.

Steve also notes the difficulty that companies have when trying to explain the technology used and how it works, “You’re going to have to be able to really document it in a way the comptroller’s office respects.”

About Steve

Recognized for his depth of experience in state tax matters, Steve is one of the state’s leading attorneys for guidance on the Texas margin tax and he frequently speaks on this topic, with ongoing commitments for presentations to Texas State Bar and University of Texas CLE programs. Steve’s state tax practice includes planning and controversy work on (i) sales tax, (ii) Texas franchise (aka “margin”) tax, (iii) ad valorem tax including Chapter 312 property tax abatements; (iv) Chapter 313 property tax value limitation agreements, and (v) insurance premium and retaliatory tax.  Steve is dedicated, from a value-driven perspective, to helping his clients fully comply with and control state tax exposure.