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Ezel / Tax Rulings / TX
TX 8710L0844D13 Sales and/or Use Tax (State,Local,MTA) 1987-10-28

Were armored payroll delivery, vault storage, helicopter delivery, and security-guard services for commercial vessels taxable in Texas?

Short answer: Yes, except security services performed exclusively offshore and outside Texas territorial waters were not taxable under the letter.

Apply this to your situation

This page answers the general question as of 1987. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1987
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 a taxpayer-specific October 1987 Texas Comptroller letter about armored delivery, vault storage, and vessel security services. It says the opinion may change if the facts differ. Its territorial-water distinction and October 1, 1987 effective date are historical; verify current law and where each service is performed. STAR documents may no longer represent current policy even when not marked superseded.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

The Comptroller said armored delivery of payroll aboard commercial oceangoing vessels, storage of those funds in a vault, and delivery of payroll to helicopters serving offshore vessels were taxable services after October 1, 1987.

Security-guard service aboard commercial vessels was taxable regardless of vessel size or displacement. The letter made one exception: security services performed exclusively offshore and outside Texas territorial waters were not taxable.

Dockside security guarding was taxable because it protected the vessels' outside perimeter rather than providing a service to the vessel. Vessel displacement did not change that answer.

What this means for you

The historical letter taxed both the money-handling services and security work connected with commercial vessels. The location of onboard security work mattered only when the service was performed exclusively outside Texas territorial waters.

Common questions

Were armored payroll delivery and vault storage taxable? Yes, after October 1, 1987.

Was helicopter delivery to offshore vessels taxable? Yes under the stated facts.

Were security guards aboard vessels taxable? Yes, unless their services were performed exclusively offshore and outside Texas territorial waters.

Was dockside security taxable? Yes.

Citations and references

  • No statute or rule number is cited in the ruling text.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS

STATE OF TEXAS

AUSTIN, 78774

October 28, 1987

Dear ***:

Thank you for your letter concerning the taxability of certain services provided by your business

Your questions specifically are whether or not you should collect sales tax in conducting the following services:

1) Payroll delivered aboard commercial oceangoing vessels by either armored courier or armored truck.

a) Vault storage of the above funds.

b) Delivery of such payroll to helicopters for delivery to offshore vessels.

Answer: Yes. Parts 1, a, b, are taxable services after October 1, 1987.

2a) Security guard service aboard commercial vessels.

Answer: Security Services provided on vessels of all sizes and displacements are taxable. However, services provided exclusively off shore and outside the territorial waters of Texas would be nontaxable.

2b) [Are] Dockside security guard service for commercial vessels[taxable?]

Answer: Yes. The service would be to insure security to the outside perimeter of the vessels and not service to the vessel. No differentiation is made for displacement size in this situation.

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 Tax Policy Division.

Sincerely,

(Mrs.) Jo Ann Dieck

Tax Policy Division

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