Section 4611(b) excise tax on domestic crude oil exports violates Export Clause (federal district court)

Excise tax on domestic crude oil exports

A federal district court this week issued its final judgment in a case in which a taxpayer challenged the excise tax imposed under section 4611(b) on domestic crude oil exports as violating the Export Clause of the U.S. Constitution. The court agreed with the taxpayer, and granted the taxpayer’s claim for a refund of the excise tax.

1000

Related content

The case is: Trafigura Trading LLC v. United States, 4:19-cv-00170 (S.D. Tex. January 7, 2021). Read the final judgment [PDF 120 KB]

The taxpayer, from 2014 to 2017, paid over $4.2 million in taxes under section 4611(b) (an excise tax imposed on certain exports of domestic crude oil). The taxpayer filed a claim for refund, asserting that the tax violates the Export Clause. The IRS denied the refund claim, and the taxpayer initiated a refund judicial suit. In September 2020, the federal district court issued its decision [PDF 1 MB] finding that the section 4611(b) tax violated the Export Clause. The final judgment this week grants the taxpayer’s claim for refund.


For more information, contact a tax professional with KPMG’s Excise Tax Practice group:

Taylor Cortright | +1 (202) 533 6188 | tcortright@kpmg.com

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Want to do business with KPMG?

 

loading image Request for proposal