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Federal Tax on Crude Oil Exports Is Unconstitutional, Court Says

March 25, 2022, 5:19 PM

A commodity trading company doesn’t have to pay taxes on the domestic crude oil it exports from the United States because the charge falls under the Constitution’s prohibition on export taxes, the U.S. Court of Appeals for the Fifth Circuit ruled.

Trafigura Trading had initially paid more than $4.2 million in taxes on about 50 million barrels of crude oil derived from Texas, Louisiana, and North Dakota under tax code Section 4611(b). Thursday’s decision from the Fifth Circuit affirmed a 2020 ruling from the U.S. District Court for the Southern District of Texas that the company should ...