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Ezel / Tax Rulings / TX
TX 8607L0745A11 Sales and/or Use Tax (State,Local,MTA) 1986-07-15

Was the service of converting an oil well from a bottom-hole pump to a gas-lift operation taxable?

Short answer: Yes. The Comptroller classified the well-conversion service as taxable remodeling.

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This page answers the general question as of 1986. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1986
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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

The requester planned to convert a well from a bottom-hole pump to a gas-lift operation.

The Comptroller classified the conversion service as taxable remodeling.

Common questions

Was the gas-lift conversion service taxable? Yes.

How did the Comptroller classify it? As remodeling.

Source

Original ruling text

July 15, 1986

Dear ***:

Thank you for your recent letter and attachments regarding service to
convert a well to a gas lift operation from a bottom hole pump.

The service provided is taxable as remodeling.

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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