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Ezel / Tax Rulings / TX
TX 8910L0965E11 Sales and/or Use Tax (State,Local,MTA) 1989-10-30

Were pest-control services exempt merely because they were performed at a school district property through another maintenance company?

Short answer: No. The pest-control provider charged tax unless the maintenance company gave a resale certificate for resale to the district or had a legal agency agreement allowing an exemption certificate. Reimbursement by the district alone did not create exemption.

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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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

Performing pest control on school-district property did not automatically exempt the provider's charge to the private maintenance company, even if the district reimbursed that company.

If the maintenance company resold the pest-control service to the district, it could give the provider a resale certificate. If it had a legal agency agreement authorizing purchases for the district, it could give an exemption certificate as the district's agent. Otherwise, the provider collected tax.

The provider could buy chemicals transferred in the service for resale but paid tax on equipment and other items not transferred to customers.

Common questions

Did school ownership automatically exempt the service? No.

When could a resale certificate be used? When the maintenance company resold the pest-control service.

When could an exemption certificate be used? Under a legal agency agreement authorizing purchases for the district.

Citations and references

  • 34 Tex. Admin. Code Rule 3.356(m)(5)

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, TX 78774

October 30, 1989

Dear ****:

Thank you for your letter dated October 17, 1989, concerning the
pest control services that you provide for Company A. According
to your letter, Company A operates the custodial and maintenance
services for Company B.

The facts that you provide pest control services on property owned
by the Company B does not automatically make your changes to
Company A exempt from sales tax. Your charges to Company A
are presumed taxable although Company A may receive reimbursement
from the school district.

Please refer to section (m)(5) of the enclosed Rule 3.356 Real
Property Services. If Company A intends to resell your services to
the school district then Company A should issue a properly-
completed resale certificate to you. If Company A has a legal
agency agreement with the school district authorizing Company A to
make purchases on behalf of the school district, then Company A may
issue a properly completed exemption certificate as agent for the
school district to you. Otherwise, you should charge sales tax to
Company A.

You may purchase chemicals that you use to provide your service
tax-free with a resale certificate. You should pay tax on
equipment and other items that are not transferred to customers.
I've also enclosed a Tax Bulletin on pest control services for
your review.

This opinion is based upon the facts you presented. If there are
additional or different facts, this opinion may change.

Please feel free to contact me if you have any additional
questions. You may write me, call toll-free 1-800-252-5555 (ext.
3-4685) from anywhere in the United States or phone 512/463-46855.

Sincerely,
Julie Pesl
Tax Correspondence

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