2010 North Carolina Code
Chapter 105 Taxation.
Article 5E - Piped Natural Gas Tax.
105-187.41. Tax imposed on piped natural gas.

105‑187.41. Tax imposed on piped natural gas.

(a) Scope. An excise tax is imposed on piped natural gas received for consumption in this State. This tax is imposed in lieu of a sales and use tax and a percentage gross receipts tax on piped natural gas.

(b) Rate. The tax rate is set in the table below. The tax rate is based on monthly therm volumes of piped natural gas received by the end‑user of the gas. If an end‑user receives piped natural gas that is metered through two or more separate measuring devices, the tax is calculated separately on the volume metered through each device rather than on the total volume metered through all measuring devices, unless the devices are located on the same premises and are part of the same billing account. In that circumstance, the tax is calculated on the total volume metered through the two or more separate measuring devices.

Monthly Volume of Rate Per Therm

Therms Received

First 200 $.047

201 to 15,000 .035

15,001 to 60,000 .024

60,001 to 500,000 .015

Over 500,000 .003

(c) (Effective until July 1, 2010 see notes) Gas City Exemption. The tax imposed by this section does not apply to piped natural gas received by a gas city for consumption by that city or to piped natural gas delivered by a gas city to a sales or transportation customer of the gas city.

(c) (Effective July 1, 2010 see notes) Exemptions. The tax imposed by this section does not apply to any of the following:

(1) Piped natural gas received by a gas city for consumption by that city.

(2) Piped natural gas delivered by a gas city to a sales or transportation customer of the gas city.

(3) Piped natural gas received by a manufacturer for use in connection with the operation of the manufacturing facility. To be eligible for the exemption, a person must have a manufacturer's certificate issued under G.S. 105‑164.28A. A person who uses piped natural gas for an unauthorized purpose is liable for any tax due on the gas.

(4) Piped natural gas received by a farmer to be used for any farming purpose other than preparing food, heating dwellings, and other household purposes. To be eligible for the exemption, a person must have a farmer's certificate issued under G.S. 105‑164.28A. A person who uses piped natural gas for an unauthorized purpose is liable for any tax due on the gas.

(d) (Effective until July 1, 2008 see notes) Reduced Rate. Piped natural gas received by a manufacturer for use in connection with the operation of a manufacturing facility or by a farmer to be used for any farming purpose other than preparing food, heating dwellings, and other household purposes is taxable at a reduced rate as provided in this subsection. To be eligible for the reduced tax rate, a person must have a manufacturer's certificate or a farmer's certificate issued under G.S. 105‑164.28A. A person who uses piped natural gas for an unauthorized purpose is liable for any tax due on the gas.

Monthly Volume of Rate Per Therm

Therms Received

First 200 $.032

201 to 15,000 .024

15,001 to 60,000 .016

60,001 to 500,000 .010

Over 500,000 .002

(d) (Effective July 1, 2008 until July 1, 2009 see notes) Reduced Rate. Piped natural gas received by a manufacturer for use in connection with the operation of a manufacturing facility and by a farmer to be used for any farming purpose other than preparing food, heating dwellings, and other household purposes is taxable as provided in this subsection. To be eligible for the reduced tax rate, a person must have a manufacturer's certificate or a farmer's certificate issued under G.S. 105‑164.28A. A person who uses piped natural gas for an unauthorized purpose is liable for any tax due on the gas.

Monthly Volume of Rate Per Therm

Therms Received

First 200 $.025

201 to 15,000 .019

15,001 to 60,000 .013

60,001 to 500,000 .008

Over 500,000 .002

(d) (Effective July 1, 2009 until July 1, 2010 see notes) Reduced Rate. Piped natural gas received by a manufacturer for use in connection with the operation of a manufacturing facility and by a farmer to be used for any farming purpose other than preparing food, heating dwellings, and other household purposes is taxable as provided in this subsection. To be eligible for the reduced tax rate, a person must have a manufacturer's certificate or a farmer's certificate issued under G.S. 105‑164.28A. A person who uses piped natural gas for an unauthorized purpose is liable for any tax due on the gas.

Monthly Volume of Rate Per Therm

Therms Received

First 200 $.014

201 to 15,000 .010

15,001 to 60,000 .007

60,001 to 500,000 .004

Over 500,000 .001

(1998‑22, s. 1; 2007‑397, ss. 11(a)‑(e).)