Who had to collect and remit Texas sales tax on property sold by resident and nonresident table holders at a gun show?

Plain-English summary

The Comptroller said all individuals, corporations, and partnerships selling tangible personal property at the gun show had to collect Texas sales tax, whether they were Texas residents or came from another state. A table at the show was treated as a temporary place of business.

The promoter could take responsibility for remitting tax collected by dealers and other sellers. Otherwise, it could require every table holder to obtain a Texas sales tax permit and handle the tax individually.

The letter defined a taxable item to include tangible personal property and taxable services. It also listed then-taxable service categories and several repair-labor distinctions.

What this means for you

Nonresident status did not remove a seller's duty at the Texas show. The practical choice was between promoter-level remittance and separate permits for table holders.

Common questions

Did Texas residents selling at the show have to collect tax? Yes.

Did out-of-state table holders have to collect tax? Yes. Their tables were temporary business locations.

Could the promoter handle remittance? Yes. Otherwise, each table holder needed a permit.

What rule governed the promoter's responsibilities? Rule 3.286(a)(3).

Citations and references

• Comptroller Rule 3.286(a)(3) — seller and show-promoter responsibilities.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8706L0828F03

Original ruling text

June 29, 1987

Dear ***:

Thank you for your letter of June 1, 1987, concerning the tax
responsibilities of table holders at your gun show. Mrs. Burchard has
retired, and I have taken the liberty of answering your letter. I have
restated your questions below:

1. With the exception of retail individuals who already possess a
   sales tax permit, is it a requirement for other table holders who
   are Texas residents to collect the applicable sales tax on each item
   sold?

Answer: Yes, CORP A (the corporation) as the promoter of the show, may
be responsible for remitting tax collected by dealers, sales persons or
other individuals at the show. Or, the corporation may require all in-
dividual table holders to apply for and have a sales tax permit. I'm
enclosing Rule 3.286, Seller's Responsibilities. Please see Sec. (a)(3),
for your responsibilities.

2. Are table holders who are residents of other states (either indivi-
   duals or business owners) required to collect the tax? Most of our out-
   of-state table holders are individuals who have no business location.

Answer: All individuals, corporations, and partnerships selling tangible
personal property at the show will be required to collect tax regardless
of their home state. The table at the show is a temporary place of busi-
ness and each table holder should have a sales tax permit unless the cor-
poration will be responsible for remitting the tax.

3. If, a non-resident of Texas is required to collect the sales tax, to
   whom must he forward the monies and whose responsibility is it to insure
   that the tax is collected and forwarded?

Answer: Please see Rule 3.286 (a)(3) and my answers to questions 1 and
2 above.

4. What is the definition of a taxable item?

Answer: "Taxable item" means tangible personal property, i.e. personal
property that can be seen, weighed, measured, felt, or touched or that
is perceptible to the senses in any other way. "Taxable item" also
means taxable services; i.e., amusement services, cable TV, certain
personal services, motor vehicle parking and storage, telecommunications
services, the repair, remodeling, maintenance and restoration of
tangible personal property. However, tax is not due on the labor to
repair, restore and maintain aircraft, certain vessels and motor
vehicles. The labor to remodel a motor vehicle is taxable. The labor
to remodel aircraft and certain vessels is not taxable.

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 me at
1-800-252-5555 toll free from anywhere in Texas. The regular number is
512/463-4600. You may write me at the Administration Division.

Sincerely,

Adina Whittemore
Tax Policy Section
Tax Administration Division