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KANSAS BECOMES SIXTH STATE TO RECOGNIZE DGE AND GGE FOR TAXATION IN 2014

On Thursday, Governor Brownback of Kansas signed into law HB 2057. The bill recognizes the use of the gasoline gallon equivalent (GGE) unit for taxing CNG and the diesel gallon equivalent (DGE) unit for taxing LNG. The measure becomes effective upon formal publication. Kansas joins a growing list of states that have moved to adjust the tax on CNG and LNG so that rates take into account energy content and ensure natural gas is not overtaxed. Prior to enactment, CNG was taxed at a rate of 23 cents per 120 cubic feet and LNG was taxed at the rate of 23 cents per gallon. CNG now will be taxed at a rate of 24 cents using a GGE or 5.66 lbs. or 126.67 cubic feet of natural gas, and LNG will be taxed at a rate of 26 cents per DGE of 6.06 lbs. of natural gas.