LAKE CHARLES -- The Louisiana Court of Appeals 3rd Circuit has affirmed a 2016 judgment rendered by the Louisiana Board of Tax Appeals favoring the Calcasieu Parish School Board’s case against Duncan Oil Inc. in its entirety.

As an oil and gas exploration company with three active and producing wells in Calcasieu Parish at the time of the filing, Duncan Oil found significant issues with how the Parish levied $59,894.44 of sales tax, interest, penalties and audit costs between December 2010 and December 2013.

Despite a firm grasp of the applicable laws at hand, Duncan sought to have these costs re-determined, but was unable to supply solid evidence supporting its claims of improper classification of taxable services.

The trial began in 2015 and centered on three main elements of Calcasieu Parish’s determination:

***One, Duncan believed paraffin removal should have been classified as a non-taxable cleaning service vs. a taxable repair.

***Two, Duncan claimed services rendered with the use of rentals were non-taxable.

***Three, Duncan considered its petition for re-determination to have a reasonable basis in law and fact and argued it should not have been subject to the penalties and attorney fees levied against it.

When it came to Duncan's first assertion, the court said Duncan failed to provide sufficient evidence to prove why the Board of Tax Appeal's reasoning lacked merit. Lack of merit also defined the failure of Duncan's second assertion, with nothing but non-specific and conclusory assertions presented as to why the Board erroneously generated the associated taxes and fees. 

Finally, because no fault was found with any method used by the Louisiana Board of Tax Appeal to determine the amount of taxes Duncan Oil had to pay, the Louisiana Court of Appeal found the penalties and attorney fees to be justified. 

The state court found the Louisiana Board of Tax Appeals committed no gross or manifestly erroneous determination in levying the taxes, penalties and other costs against Duncan Oil. 

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