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Ezel / Tax Rulings / TX
TX 8804L0866G01 Sales and/or Use Tax (State,Local,MTA) 1988-04-22

Were sightseeing tours taxable amusement services, and was a tour consisting primarily of transportation to a rodeo taxable?

Short answer: The sightseeing tours were taxable amusement services. The rodeo trip was primarily transportation and not taxable, but the operator still had to account for tax on the rodeo admission.

Apply this to your situation

This page answers the general question as of 1988. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1988
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 an official 1988 Texas Comptroller of Public Accounts letter applying Rule 3.298, published on the State Tax Automated Research (STAR) system. Its tour classifications and admission-tax procedure reflect the law stated when issued; verify current amusement and transportation rules before applying them today. The letter also says prior misinformation did not authorize the writer to waive tax. STAR letters can support detrimental reliance only for the taxpayer directly issued the letter and may no longer represent current policy. Taxpayer-identifying details 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 classified three primarily sightseeing tours as taxable amusement services and told the operator to collect tax on the brochure prices.

A fourth tour was primarily transportation to a rodeo, so its tour price was not taxable. For the rodeo admission, the operator could either pay tax to the rodeo or give the rodeo a resale certificate and collect tax from the customer.

The letter acknowledged that Comptroller employees had previously given misinformation but said the writer had no authority to waive the tax.

What this means for you

Under this 1988 guidance, the tour's primary purpose controlled: sightseeing was a taxable amusement, while transportation to an event was not. Any taxable admission bundled into the trip still required separate tax handling.

Common questions

Were sightseeing tours taxable? Yes, as amusement services.

Was the rodeo transportation charge taxable? No.

How could the operator handle rodeo admission? Pay tax to the rodeo or buy the admission for resale and collect tax from the customer.

Did prior employee advice waive the tax? No, according to the letter.

Citations and references

  • 34 Tex. Admin. Code Rule 3.298, cited for amusement services.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

April 22, 1988

Dear ***:

Thank you for your letter regarding taxability of your tours.

Since tours 1, 2 and 3 are primarily sight-seeing tours, they are taxable
amusement services. You should collect tax on the tour prices listed in
your brochure.

Tour 4 is primarily transportation to the rodeo, and the "tour price" is
not
taxable. You may either pay tax to the rodeo, or give them a resale
certifi-
cate and collect tax from your customer on the rodeo admission.

I understand that you were misinformed by some of our employees. I don't
have the authority to waive tax. I suggest you try to find the names of
those employees. You should contact them and have them confirm what they
told you.

I have enclosed a Sales Tax Application and Rule 3.298 - Amusement
Services.

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 our
toll-free
number 1-800-531-5441. 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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