Were tire repairs taxable on highway motor vehicles and on non-motor-vehicle workover rigs, and where was local tax due?

Plain-English summary

The 1985 letter distinguished the repaired property. Tire repairs on motor vehicles were not taxable, while tire repairs on workover rigs and other non-motor vehicles were taxable.

For local tax, the letter used the repairman's place of business. If that place of business was in a taxing city, local tax was due even when the repair work happened at a rural field location.

STAR adds a later alert stating that, as of January 15, 2015, the definition of a place of business changed. The reproduced alert gives the later definition, so the letter's 1985 sourcing answer should not be assumed to state current law.

Common questions

Did the field location determine whether the repair itself was taxable? No. The letter distinguished motor vehicles from workover rigs and other non-motor vehicles. Could city tax apply to rural work? Yes under the historical answer, when the repairman's place of business was in a taxing city. Is that sourcing rule necessarily current? No; STAR flags a 2015 definitional change.

Citations and references

The reproduced letter and alert cite no numbered statute or rule.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8505L0641B04

Original ruling text

Alert: As of 01/15/2015, a place of business is defined as "an established outlet, office, or location operated by a seller for the purpose of selling taxable items to those other than employees, independent contractors, and individual persons affiliated with the seller."

May 7, 1985

Dear ***:

Thank you for your recent letter regarding tire repair. I have restated your information with response below.

Could you please provide us with a determination as to whether or not tire repairs are taxable. Will the taxability of such a service be determined by whether or not tire repair was performed on a vehicle permitted for highway use (motor vehicle)? Furthermore, would you please provide us with a determination as to where local tax would be due. Please note that we maintain a large fleet of workover rigs which are not classified as true motor vehicles, and that the repair of their tires usually occurs out at field locations.

Response: Tire repairs on motor Vehicles are not taxable. Tire repairs on workover rigs and other non-motor vehicles are taxable. Local tax would be charged based on the place of business of the repairman.

If the repairman's place of business were in a taxing city, local tax would be due even if the repair were performed at a rural location.

This opinion is based on the facts presented. If there are additional or different facts, the opinion may change.

If you have any questions or need more information, please call us at 1-800-252-5555 toll free from anywhere in Texas. You may write us at the Tax Administration Division.

Sincerely,

Tax Policy Section

Tax Administration Division