A state franchise tax apportionment rule improperly imposes a place-of-delivery test when the tax code establishes an ultimate-destination test, a company that transports and stores crude oil told the Texas Supreme Court.
NuStar Energy LP is asking the high court to review a 2023 ruling in favor of the state. The appeals court held that the rule on how to apportion business activities to the state adopted the "only reasonable construction" of the tax code by saying the place of delivery controls for apportionment purposes even when the buyer is located out of state.