Did holding property in Texas for more than 30 days destroy the export exemption, and what proof did Rule 3.323 require?

Plain-English summary

Property bought in Texas and held by its owner for more than 30 days was presumed stored. Because storage was a Texas use, the export exemption was lost.

Property held by a freight forwarder for more than 30 days did not lose the exemption merely because of that delay. The forwarder held it for export, rather than the owner storing or using it, but documentation under Rule 3.323(c)(1)(D) was still required to prove export.

The letter also said the Licensed Customs Broker Export Certification form was not required in addition to the export documentation listed in Rule 3.323(c)(1)(A), (C), and (D).

Common questions

Did the 30-day presumption apply when the owner held the property? Yes.

Did a freight forwarder's possession beyond 30 days automatically destroy the exemption? No.

Was export documentation still required? Yes.

Was a customs-broker certification always required in addition to the listed documents? No.

Citations and references

• Texas Comptroller Rule 3.323 — imports and exports, including proof, storage, freight-forwarder, and customs-broker provisions.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8601L0693D05

Original ruling text

January 8, 1986

Dear ***:

Thank you for your letter concerning a clarification of several subsections of
rule 3.323 Imports and Exports.

(c)(1) Exports has four subsections that explain various ways to prove an
Export has been made before a buyer may be eligible to receive a refund of
sales tax previously paid to the seller. (c)(1)(9) is an alternative, provided
by the legislature, to prove that tangible goods were exported from Texas.

(c)(3) means that property purchased in Texas and held by the owner for over 30
days from the date of purchase is presumed to have been stored. Storage of
tangible personal property in Texas is a use of that property in Texas and the
export exemption is lost. However, property in the possession of a freight
forwarder does not lose the export exemption if held over 30 days since the
property is being held for the purpose of export by the forwarder and is not
stored or used by the owner of the property. Documentation as outlined in
(c)(1)(D) is required to substantiate that the property was exported and thus
qualifies for exemption.

(G) outlines the contents of a Licensed (Customs Broker Export Certification
form. (c)(1) outlines the various documents that are required as proof of
export. The Licensed Customs Broker Export Certification form is not required
in addition to the documentation outlined in (c)(1)(A)(C)(D).

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

Please feel free to contact us if you have additional questions. You may write
us, call toll free 1-800-252-5555 from anywhere in Texas.

Sincerely,

Tax Policy Section
Tax Administration Division