Were charges for analyzing, trapping, and removing wild animals taxable in Texas, and what about labor to repair the resulting property damage?

Plain-English summary

The business charged separately to identify a varmint and determine its entry and damage, to trap and remove it, and sometimes to repair the damage.

The Comptroller treated the analysis, trapping, and removal as taxable real-property services even though the business might not be licensed by the Structural Pest Control Board. Labor to repair improvements to realty was not taxable at the time of the letter, but the Comptroller warned that some repair and remodeling charges would become taxable January 1 and that the rules were not yet written.

The business location had no city sales tax but was inside an MTA, producing a 7% rate there. Jobs in a city with city sales tax also required collection of that city tax.

What this means for you

The historical letter separated animal-related real-property services from repair labor. It also based local tax on the business and job locations described, so current providers should not reuse the 1987 rate.

Common questions

Were animal analysis, trapping, and removal taxable? Yes.

Did the answer depend on a pest-control license? No. The letter required tax even if the provider was not licensed by the Structural Pest Control Board.

Was repair labor taxable? Not when the letter was issued, but the Comptroller flagged an imminent January 1 rule change without stating the final rule.

Citations and references

• 34 Tex. Admin. Code Rule 3.356 (real property services)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8711L0846A01

Original ruling text

November 9, 1987

Dear **:

Thank you for recent letter. I have reviewed your facts and determined that
your charges for varmint removal are real property services. You must charge
sales tax even though you may not be licensed by the Structural Pest Control
Board.

In my conversation with MRS. PERSON A I learned that you make 3 types of
charges. First you do an analysis to determine the type of varmint, his method
of entry and actual damage done. Second you trap and remove the animal and
third you may contract to repair the damage.

The charges for analysis, trapping and removal are taxable. The charges for
labor to repair improvements to realty are not currently taxable. I explained
to MRS. PRESON A that certain charges for real property repair and remodeling
would become taxable on January 1 but that the rules had not yet been written.
She agreed to call me back about mid December on this.

The area, known as CITY A, does not have city sales tax but it is within the
CITY B MTA. Therefore, the tax rate at your place of business in CITY A is 7%.
If you do a job in a city which has city tax, that tax should also be
collected.

I have sent you a sales tax application under separate cover and am enclosing
tax rate charts and Rule 3.356 for your reference.

If you have any questions or need more information, please call me at
1-800-252-5555 toll free from any where in Texas. The regular number is
512/463-4600. You may write me at the Tax Policy Division.

Sincerely,

Al Van Allen
Tax Policy Division