The Look in Brief

CSX Railroad challenges Tennessee fuel tax, seeks $28M refund

By: - November 6, 2023 6:02 am
(Getty Images)

(Getty Images)

Tennessee faces yet another legal challenge to existing state law, this time from one of the nation’s largest railroad companies.

CSX Transportation claims a Tennessee statute levying a diesel tax on railroads violates federal law. It is seeking a $28 million refund from the state in taxes already paid at the pump, according to a lawsuit filed in Davidson County Chancery Court against the David Gerregano, Tennessee’s Commissioner of Revenue.

The state is fighting a slew of legal battles brought over recently enacted legislation. CSX’s lawsuit, however, centers on a law enacted nine years ago: the 2014 Transportation Fuel Equity Act. 

The law imposes a 17 cents-per-gallon tax on railroad diesel fuel, but it effectively exempts water carriers and motor carriers — CSX’s main competitors, the lawsuit claims. Trucking companies pay a separate Highway User Fuel Tax intended to support maintenance of the state’s roadways. CSX argues railroads are being singled out for taxation in violation of a federal law that prohibits the imposition of discriminatory taxes on railroad carriers. 

Last year CSX sought a refund of the taxes it has paid since 2014, but was denied. The denial was “unjust, illegal and incorrect,” the suit claims. 


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Anita Wadhwani
Anita Wadhwani

Anita Wadhwani is a senior reporter for the Tennessee Lookout. The Tennessee AP Broadcasters and Media (TAPME) named her Journalist of the Year in 2019 as well as giving her the Malcolm Law Award for Investigative Journalism. Wadhwani is formerly an investigative reporter with The Tennessean who focused on the impact of public policies on the people and places across Tennessee.