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Ezel / Tax Rulings / TX
TX 8909L0958G13 Sales and/or Use Tax (State,Local,MTA) 1989-09-01

Could a manufacturer obtain a sales-tax refund on an inactive electricity account after changing utility suppliers?

Short answer: Yes, if the electricity qualified for exemption and the manufacturing operations had not changed. The manufacturer had to give the previous utility supplier properly completed exemption certificates and an engineer's certification.

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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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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 manufacturer changed utility suppliers while its manufacturing operations remained unchanged and sought a sales-tax refund on the inactive electricity account.

The tax could be refunded if the electricity qualified for exemption. The manufacturer had to provide the previous utility supplier with properly completed exemption certificates and an engineer's certification.

The ruling body addresses electricity only despite the broader STAR subject label mentioning gas, so this page does not claim a gas-account result.

Common questions

Did changing suppliers prevent a refund? No.

What condition applied? The electricity had to qualify for exemption.

What documents went to the former supplier? Proper exemption certificates and an engineer's certification.

Did the body decide a gas refund? No.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller September 1, 1989

Dear ***:

Thank you for your letter regarding a sales tax refund on an
inactive electricity account.

You explained that your client, COMPANY ABC recently changed
utility suppliers. Regardless of the change of utility sup-
pliers, the manufacturing operations have remained unchanged.

Based on the information, sales tax can be refunded on the inac-
tive electricity account if the electricity qualifies for exemp-
tion. Properly completed exemption certificates and engineers
certification must be issued to previous utility supplier.

This opinion is based on the facts presented. If there are addi-
tional or different facts, the opinion may change.

If you have any questions or need additional information, you may
call me toll-free 1-800-252-5555, extension. 3-4666. You may
write me at Tax Correspondence, Comptroller of Public Accounts.

Sincerely,
Jo Ann Dieck
Tax Correspondence

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