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Ezel / Tax Rulings / TX
TX 8506L0643E11 Sales and/or Use Tax (State,Local,MTA) 1985-06-05

Was sawdust used by a meat-packing company to smoke meat taxable?

Short answer: No. The sawdust was necessary and essential and was consumed in processing the meat. The seller was instructed to obtain a properly completed exemption certificate from the customer instead of collecting tax.

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This page answers the general question as of 1985. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1985
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

Sawdust used to smoke meat at a meat-packing company was not taxable because it was necessary and essential and was consumed in processing. The seller was told to obtain a properly completed exemption certificate from the customer instead of collecting tax.

Common questions

Was the sawdust taxable? No under the stated use. Why? It was necessary and essential and consumed in processing. What documentation did the seller need? A properly completed exemption certificate.

Citations and references

The reproduced letter cites no numbered statute or rule.

Source

Original ruling text

June 5, 1985

Dear ***:

Thank you for your letter of May 23, 1985 concerning the taxability of
sawdust used in smoking meats at a meat packing company.

Sawdust used to smoke meat at a meat packing company is not taxable since
it is necessary and essential and is being consumed in processing.

You should obtain a properly completed exemption certificate from your
customers, in lieu of tax.

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

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