General Motors is to get a refund of $US500,000 from the state of Michigan for motor fuel taxes after the state’s appeals court overturned a lower court decision denying the carmaker the payment.

According to the Detroit News, GM sought the refund under a state law that allows individuals and companies to seek repayment of motor fuel taxes paid when petrol or diesel is used to power vehicles that don’t use state roads.

In GM’s case, the petrol was placed in vehicles assembled in Michigan but shipped elsewhere for sale, the newspaper said.

The Detroit News said GM won the appeal when the state court determined it filed a claim for the refund within the statue of limitations in 2001 – GM’s original claim was denied based on a previous version of the motor fuel tax law that was in effect when the company purchased the petrol.

The newspaper said the law was changed in 2001, extending the statute of limitations from one year to 18 months, but the appeals court said GM actually had four years to seek a refund based on a 1998 case involving DaimlerChrysler.

In that case, the Detroit News noted, DaimlerChrysler won a $1.7 million refund from the state when a state tax tribunal ruled an amendment to the 1992 Motor Fuel Tax Act “clearly states Michigan gas tax does not apply to gasoline that is placed in the fuel supply tanks of new motor vehicles manufactured in Michigan and shipped to locations outside Michigan.”

The paper said DaimlerChrysler had sought $3.5 million to account for interest but, while the state didn’t specifically deny the carmaker the interest, it simply didn’t pay it.