Mississippi Supreme Court Affirms Use Tax on Freight Charges Paid to Third-Party Not Taxable

The Mississippi Supreme Court issued a judgment affirming Hinds County Chancery Court’s ruling against the Department of Revenue’s (DOR) improperly assessed use tax on freight charges taxpayer paid to a third-party. Taxpayer, a natural gas transportation service company purchased tangible personal property to use in Mississippi and paid use tax on these purchases. Taxpayer paid freight charges to a third-party company to ship these goods to Mississippi, and did not include the freight charges in its tax base for the use tax calculation on the goods purchased. DOR conducted an audit and assessed use tax on the freight charge. Taxpayer ...