Railroad Cross Ties, Bridge Timbers, Etc

(1) Where a railroad buys untreated ties or timber in this State and pays the Sales Tax thereon, it may, thereafter, have such ties or timber creosoted within or without the State without being subject to the payment of further Sales or Use Tax if such property is used in this State. (2) Where a railroad buys untreated ties or timber in this State for shipment in interstate commerce and does not pay the Sales or Use Tax thereon, and such ties or timber are shipped and creosoted outside the State, and subsequently shipped and used in this State, such railroads will be required to pay a Use Tax thereon, based upon the cost of the untreated ties or timber in Tennessee, and the cost of processing of the finished product brought into the State. (3) Where a railroad buys untreated ties or timber outside the State and brings said property into the State for creosoting or other processing treatment, such railroads will be required to pay a Use Tax based upon the amount paid for such untreated ties and timber. (4) Where a railroad buys untreated ties or timber outside the State, and the same are creosoted outside the State of Tennessee, and the railroad subsequently brings said ties or timber into the State for use, such railroad will be required to pay the Use Tax thereon, based upon the cost of the finished product. STATE SALES AND USE TAX RULES CHAPTER 1320-05-01