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Ezel / Tax Rulings / TX
TX 8711L0845G09 Sales and/or Use Tax (State,Local,MTA) 1987-11-06

Did a private retail club have to collect Texas sales tax on its $5 annual membership fee when the club existed to sell gasoline to members?

Short answer: No. The gasoline retail club did not provide entertainment, recreation, sports, dining, or social facilities, so it was outside Rule 3.298's taxable private-club membership category.

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 November 1987 Texas Comptroller letter about a private retail club whose purpose was selling gasoline to members for a $5 annual fee. It says the opinion may change if the facts differ. Its Rule 3.298 private-club and amusement-services analysis is historical and may have changed substantially; verify current law and every facility or benefit included with membership. STAR documents may no longer represent current policy even when not marked superseded.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 private retail club did not have to collect sales tax on its $5 annual membership fee. Its purpose was to sell gasoline to members.

Rule 3.298 taxed dues and membership fees paid to country clubs and other private clubs or organizations providing entertainment, recreation, sports, dining, or social facilities. The gasoline retail club did not fit that definition.

What this means for you

The historical result turned on what the membership actually provided. A retail-access fee was outside the listed amusement-club category because the club provided none of the entertainment or social facilities named in the rule.

Common questions

Was the $5 annual membership fee taxable? No.

Why was it outside the amusement rule? The club existed to sell gasoline and did not provide entertainment, recreation, sports, dining, or social facilities.

Does the letter decide the tax treatment of the gasoline itself? No. It addresses only the membership fee.

Citations and references

  • 34 Tex. Admin. Code Rule 3.298 (amusement services)

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller November 6, 1987

Dear ***:

Thank you for your recent letter concerning the taxability of membership
fee
to a private club. I understand the purpose of your club is to sell
gasoline
to members. The members pay a $5.00 annual membership fee.

Amusement Rule 3.298 specifically taxes membership fees and dues paid to
country clubs and other private clubs and organizations that provide
entertainment, recreation, sports, dining, or social facilities to
members.
Your private retail club does not fit this definition. Therefore, you
are
not required to collect tax on the membership fee.

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,
Adina Whittemore
Tax Policy Division

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