Request By:
Mr. J. T. Underwood, Jr.
Kentucky LP-Gas Association, Inc.
109 Thistle Road
P.O. Box 592
Frankfort, Kentucky 40601
Opinion
Opinion By: Robert F. Stephens, Attorney General; By William S. Riley, Assistant Attorney General
In your recent letter to the Attorney General, it is stated that the 1978 General Assembly amended the Sales and Use Tax law by adding subsection (13) to KRS 139.480. See Kentucky Acts, Chapter 135. This section provides as follows:
"Any other provision of this chapter to the contrary notwithstanding, the terms 'sale at retail,' 'retail sale,' 'use,' 'storage, ' and 'consumption, ' as used in this chapter do not include the sale, use, storage or other consumption of:
* * *
"(13) Gasoline, special fuels, and liquified petroleum gas used to operate or propel stationary engines or tractors for agricultural purposes as used in this subsection:
"(a) 'Gasoline' is defined as in KRS 138.210(4);
"(b) 'Special fuels' is defined in KRS 138.560(3);
"(c) 'Liquefied petroleum gas' is defined in KRS 234.100(1); and
"(d) 'Agricultural purposes' is defined as in KRS 138.343(4)."
The term "agricultural purposes" has been defined as "purposes directly related to the production of agricultural commodities and the conducting of ordinary activities on the farm." "Agricultural purposes" also means the using of the soil for planting seeds, raising and harvesting the crops, the rearing, feeding and management of livestock. See
Binzel v. Grogan, 29 N.W. 895, 67 Wis. 147, 150 (1886).
The question is whether liquefied petroleum gas used for the following purposes is exempt under the above provision of the statutes.
1. Grain drying
2. Tobacco curing
3. Dairy production (Dairy parlors)
4. Farrowing pens
5. Poultry houses for the production of poultry
Such fuels used in the activities above would come within the exemption statute.
If you have additional questions concerning this matter, please direct them to Mr. Claude B. Slone, Director, Sales and Severance Tax Division, Department of Revenue, Frankfort, Kentucky 40601.