The Department conducted an audit of Taxpayer's electricity
usage from the mixed usage meter. The Department listed the items used in 2010
in industrial processing connected to the meter in question that used
electricity. The kWh/year for these items was totaled, and then that amount was
divided by the total electricity consumed from this meter in 2010. From this
information the electricity used in industrial processing was calculated at
forty-seven point five (47.5) percent from this meter. Therefore, the
Department assessed use tax on fifty-two point five (52.5) percent of
Taxpayer's electricity from this meter.
Taxpayer's representative claims that 52.5 percent is much too large, finding the factor to be no more than 2.5 percent. Taxpayer provided no information to substantiate this claim, merely pointing out that lighting was not included amongst the items used in industrial processing. However, lighting is not an integral part of industrial processing. As Sales Tax Information Bulletin 55 (May 31, 1989 (Revised)) explains, "Utilities used for... general lighting (including security lighting)... [is] taxable." Taxpayer has not met its burden to show that the Department's audit's determination is incorrect.
http://www.in.gov/legislative/iac/20120425-IR-045120183NRA.xml.html