How do you determine taxing jurisdiction for sales of coal and other minerals?
The local government unit where the coal or other mineral (such as oil, sand, gravel or stone taken from a quarry, and any other mineral) is extracted from the earth is deemed to be the place where the retail sale occurs. The fact that the mining company may maintain an office within a different local taxing jurisdiction where final acceptance of the orders occurs is not a determining factor for sales of these items. Sales of coal and other minerals, regardless of where they are mined, will generally be exempt if the mineral is shipped out of Illinois by the seller for use outside Illinois. Also, a sale by a producer to a wholesaler or retailer for resale is not a retail sale and would not generate sales tax for the benefit of the local government where the mining occurred.
