(a) The tax on all sales of natural gas or electricity to manufacturers shall be calculated and remitted as follows:

1. (1) Apply the four and five-tenths percent (4.5%) (four percent (4%) after July 1, 2008) state tax rate to:

   1. (A) Sales of natural gas or electricity from separate meters certified for use solely in manufacturing; and
   2. (B) Sales of the percentage of natural gas or electricity sold from each mixed-use meter that is certified for the reduced rate on the certificate issued to the manufacturer by the Sales and Use Tax Section;

2. (2) Apply the six percent (6%) state tax rate to:

   1. (A) Sales of natural gas and electricity from separate meters not used in manufacturing; and
   2. (B) The percentage of natural gas or electricity from mixed-use meters that is not taxed at the reduced rate; and
3. (3) Apply the local tax to all sales from all meters.

(c) Seller collects tax.

1. (1) Manufacturers who either do not have direct pay permits or do not wish to remit tax on utilities on their direct pay report must determine whether each seller of natural gas or electricity is able to apportion the billing for each mixed-use meter by applying the two (2) different state tax rates to sales from each mixed-use meter.
2. (2) The manufacturer must provide any seller of natural gas or electricity who is able to apportion the billing for mixed-use meters with the certificate that lists the percentage of the sale from each meter that is subject to the reduced rate (Form ET185RR).

3. (3) The manufacturer has the following options regarding purchases of natural gas or electricity from a seller who is not able to apportion the billing:

   1. (A) Obtain (or use if already permitted) a direct pay permit (that can be used to remit the tax due on all purchases or only on purchases of natural gas or electricity used directly in manufacturing) and remit the tax directly to the Sales and Use Tax Section; or
   2. (B) Pay the full state tax rate of six percent (6%) to the seller and file a request for refund with the Sales and Use Tax Section for the overpayment that includes documentation regarding the calculation of the overpayment.