Ohio Air Taxi Not Exempt Public Utility

Monday, September 8th, 2014

An air taxi.

The Ohio Board of Tax Appeals ("Board") recently ruled that an air taxi operator did not qualify as a public utility for a sales tax exemption.

The taxpayer provided cargo air transportation services. It specialized in transporting time-sensitive cargo, such as checks for transfer among financial institutions, radio pharmaceuticals, and sensitive government documents. The taxpayer could have sought a certificate of public convenience and necessity, but it chose not to do so.

Ohio exempts sales of items used or consumed directly in rendering a public utility service. To determine whether a business is a "public utility," Ohio looks at the amount of special regulation and control by a government regulatory agency. Businesses that are not subject to a great degree of such regulation are not public utilities. A "public utility" includes a United States citizen that holds a certificate of public convenience and necessity. To get such a certificate, a person must undergo review by the federal Department of Transportation and submit periodic reports to that Department, among other things.

The Board ruled that the air taxi operator was not a public utility. The Board said that it was not necessary to have a certificate of public convenience and necessity to be a public utility, but a public utility must be subject to a great deal of government regulation. Although the taxpayer had to comply with certain requirements from its customers because of the sensitive services it provided, the taxpayer voluntarily undertook those obligations. The government did not impose those obligations. The taxpayer did not have a certificate of public convenience and necessity and did not have enough government regulation. The taxpayer was therefore not a public utility.


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Texas Exempts Boats and Motors Temporarily Used in the...

Wednesday, June 26th, 2019 -Texas has recently passed a bill creating an exemption for boats and motors purchased for use outside of the s...

Data Survey Services Not Taxable in South Carolina

Monday, June 24th, 2019 -The South Carolina Department of Revenue recently ruled that business data survey services were non-taxable pr...

Senior Center Cafeterias are Taxable in Missouri

Friday, June 21st, 2019 -Missouri's Director of Revenue recently issued a letter ruling taxing the sale of cafeteria food by a 501(c)(3...

Hot-Air Balloon Rides in Missouri are Taxable When...

Wednesday, June 19th, 2019 -Missouri recently released a letter ruling addressing the taxation of hot-air balloon rides. The taxpayer was ...

Nevada Exempts Certain Medical Equipment

Monday, June 17th, 2019 -Effective July 1, 2019, Nevada will exempt durable medical equipment, oxygen delivery equipment, and mobility ...

Participatory Sports are Taxable in New York

Friday, June 14th, 2019 -The New York Division of Tax Appeals recently denied a refund claim made by an instructor-led indoor spin clas...