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Ezel / Tax Rulings / TX
TX 8908L1026E09 Sales and/or Use Tax (State,Local,MTA) 1989-08-01

Could the redacted party give a resale certificate for remodeling work that added newsstand facilities at an airport?

Short answer: Yes, under the stated arrangement. Title passed at completion, while the redacted entity received operating rights and a later fair-market-value payment.

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This page answers the general question as of 1989. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1989
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 Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
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

A redacted entity had contracted to remodel an airport by adding newsstand facilities. Title to the facilities would pass upon completion. The entity would be compensated through the right to lease and operate the facilities and a fair-market-value payment at the end of the lease.

On those facts, the Deputy Comptroller said the redacted party could give a resale certificate for the airport remodeling work.

The STAR subject label refers broadly to hangars, terminals, and air-cargo facilities, but the preserved letter decides only the described newsstand-facility arrangement.

Common questions

Could the remodeling services be purchased for resale? Yes, under the facts stated in the letter.

What airport work did the letter actually describe? Adding newsstand facilities.

Did the letter decide every airport remodeling arrangement? No. Its answer was tied to the stated title-transfer and compensation terms.

Source

Original ruling text

August 1, 1989

Dear ***:

I just want to take a minute to respond to your question regarding
***.

You stated that * has contracted with the ***
to remodel the airport by adding newsstand facilities. Title to the
facilities is to pass to * upon completion.

Host will be compensated by being allowed to lease and operate the
new facilities and also will be paid fair market value for them at
the end of the lease. You said that ** commonly engaged in this
type of activity and asked if they could purchase the remodeling
services tax free on a resale certificate.

Under the above facts, ** may give a resale certificate
for remodeling work done on the airport facilities.

If you have other questions, please let me know.

Sincerely,

Dan Pearson
Deputy Comptroller

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