YOU MEAN THE IRVINGS LOST??????

SCOC dismisses Irving tax case
Last updated Oct 27 2005 12:55 PM ADT
CBC News
Irving Oil has lost its bid to have its property taxes reduced at its Saint John oil refinery.


Irving Oil has been fighting to have $20 million worth of oil tanks at the refinery classified as manufacturing equipment and declared tax free, but the Supreme Court of Canada has dismissed Irving's request for a hearing on the matter.

Irving originally won the tax case at trial, but that decision was overturned by the New Brunswick Court of Appeal last March. The Supreme Court has now ruled the Appeal Court decision should stand, meaning Irving is not entitled to a tax reduction.

Irving Oil had been fighting for years to have taxes on its oil refinery cut by about 25 per cent. At issue is a section of the property that holds dozens of huge oil tanks. The company pays about $4 million a year in property taxes, with about a million in taxes coming from the oil tanks.

The taxes are split between the province and City of Saint John.

Irving Oil claims the tanks shouldn't be taxed at all. It wants a reduction and would like the provincial government to refund taxes paid between 2001 and 2004.

Saint John Lawyer John Barry says oil storage tanks are normally subject to property tax in New Brunswick but manufacturing equipment is not. "The issue of the tanks is whether they're part of the manufacturing process or whether they're used for storage."

In Irving's case, the company says although the oil tanks store finished petroleum products, those products have to be constantly stirred, which makes the tanks part of the manufacturing process and should be tax free.

Barry does not represent either party in the dispute, but says the case is simple. "If they're part of the manufacturing process, they fall under machinery and they're exempt and not subject to property tax assesment. If they're storage tanks, they do fall under property tax assesment."

Irving Oil's property taxes are a sensitive issue in Saint John. Protests broke out on the streets and inside Saint John council chambers earlier this year after Irving Oil received a $100 million property tax cut, spread over 25 years, on a planned Liquified Natural Gas terminal in the city.

Saint John City Councillor Glen Tait says Irving Oil is well within its rights to fight property taxes at the refinery too but is afraid the public isn't in the mood to hear about it. "This certainly will revitalize the whole issue and bring it to the surface again, and there will be discussion on that whole issue again...here we are –another tax break for the Irvings."