March 18, 2019
NOTICE OF GRU TAX SCAM ON UNECONOMIC GRU OUTDOOR LIGHTING
To: All Clients
From: Jim Konish
Re: Over Taxation of GRU Outdoor Lighting
- UTILITY TAX (City of Gainesville or Alachua County, a/k/a Public Service Tax (§166.231, Fla Stat.)
166.231 (1) (a) Provides: “A municipality (or County) may levy a tax on the purchase of electricity…” “The tax shall be levied only upon purchases… and shall not exceed 10 percent…”
166.231 (1) (b) Provides: “The tax…, shall not be applied against any fuel adjustment charge, and such charge shall be separately stated on each bill.”
- GROSS RECEIPTS TAX (State of Florida) §203.01 (1) (a) (1) Provides: “A tax (Prepyramided from 2.5% to 2.5641%) is imposed on gross receipts from utility services…”
Florida Department of Revenue (DOR) Rule 12B-6.001(2)(h) provides “This paragraph does not broaden the definition of utility service to include separately stated charges for tangible personal property…”
GRU imposes charges labelled as “Lights and Poles” on the front of the GRU bill. (See Item 1)
GRU provides “Light and Pole Details” on the back of the bill (See Item 2). Under “Description”, GRU separately states its charges for rental light fixtures and poles. It also separately states an “ELECTRIC FUEL ADJUSTMENT” charge. Finally, the “FLORIDA GROSS RECEIPTS TAX” and “ELEC UTIL TAX (City of Gainesville or Alachua County) are also separately stated – if applicable.
ANALYSIS: The charge for taxable fuel, and the non-fuel charges for estimated electricity furnished to the GRU light fixtures installed are not separately stated. Instead, these charges are bundled in with the rental of the light fixture.
Also, the GRU servicing of burned out bulbs at the customers’ request is likewise bundled in with the rental fees for the light fixture.
GRU is raising its charge for rental outdoor light fixtures as much as 22% per year. Many of these fixtures are inefficient non-LED fixtures.
Then, GRU improperly imposes both the State Gross Receipts Tax and the Utility Tax (unless there is an exemption), on the bundled (1) rental fees for the light fixture, (2) the service contract for burned out bulbs and (3) the non-fuel and taxable fuel components of estimated electricity delivered to the light fixture. (See Item 3) The pole rental fees are not taxed.
Moreover, the Utility Tax, when applicable, is also applied to the Gross Receipts Tax.
Accordingly, all GRU outdoor lighting bills are incorrect as to Gross Receipts Tax and Utility Tax – if applicable.
State of Florida Sales Tax, and local Sales Surtaxes, are also applied, if applicable. (See Item 4)
The overcharge for GRU outdoor lighting ranges from 2.5641% when there is a utility tax exemption, to 12.82% when there is no utility tax exemption (exclusive of surcharges and pole rental fees.)
Please provide guidance to how you want me to proceed. A Revenue Ruling has been requested from the Florida Department of Revenue (DOR) in regard to the Gross Receipts Tax, and is expected to be received soon.
Attorney for GRU Ratepayers Only