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Ezel / Tax Rulings / TX
TX 8611L0774A05 Sales and/or Use Tax (State,Local,MTA) 1986-11-25

Were fees charged by video-rental outlets for rewinding returned cassette tapes subject to Texas sales tax?

Short answer: Yes. An internal Tax Policy memorandum classified video-cassette rewinding charges as taxable maintenance.

Apply this to your situation

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 1986 record is an internal Comptroller exchange between Austin Audit and Tax Policy, not a completed taxpayer-specific response. It states only that video-cassette rewinding charges were taxable maintenance and gives no citation or further reasoning. Rental, media, maintenance, digital-service, fee, and local-tax rules may have changed. STAR documents may no longer represent current policy even when not marked superseded. Identities are redacted. This summary is informational only and is not legal or tax advice.
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

Texas Tax Policy told Austin Audit that charges made by video-rental outlets for rewinding returned cassette tapes were taxable as maintenance.

The record is a short internal memorandum exchange and contains no further analysis or citation.

What this means for you

The memorandum classified the rewind fee itself as taxable maintenance. It did not discuss tape rental charges, late fees, damage fees, or other video-store transactions.

Common questions

Was the rewinding charge taxable? Yes.

How was it classified? Maintenance.

Was this a taxpayer letter? No. It was an internal audit-policy exchange.

Citations and references

  • The memorandum cited no numbered statute or Comptroller rule.

Source

Original ruling text

DATE: November 25, 1986

TO: ***, Austin Audit
FROM: *****, Tax Policy
SUBJECT: Video Cassette Tape Rewind Charges

Charges made by video tape rental outlets for rewinding tapes are taxable
as maintenance.

November 21, 1986

TO: ***, Tax Policy
FROM: *****, Austin Audit
SUBJ: Video Cassette Tape Rewind Charges

Video tape rental outlets charge for rewinding tape cassettes
upon return if rewinding is needed. Is this maintenance
taxable?

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