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Ezel / Tax Rulings / TX
TX 9001L0976G13 Sales and/or Use Tax (State,Local,MTA) 1990-01-26

Was annual calibration of tools used to inspect manufactured parts subject to Texas sales tax?

Short answer: Yes. The described calibration qualified as taxable maintenance or repair of tangible personal property under Rule 3.292, so the total service charge was taxable.

Apply this to your situation

This page answers the general question as of 1990. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1990
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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

The manufacturer used tools to inspect the dimensions of parts made for sale. A service company visited annually to inspect or calibrate those tools for accuracy.

The Comptroller classified the service as calibration and therefore as maintenance or repair of tangible personal property under Rule 3.292. The total calibration charge was taxable.

Common questions

Was calibration taxable? Yes.

Did use in manufacturing make it exempt? The letter did not allow an exemption on that basis.

What rule controlled? Rule 3.292 governing repair, remodeling, maintenance, and restoration of tangible personal property.

Citations and references

  • 34 Tex. Admin. Code Rule 3.292

Source

Original ruling text

January 26, 1990

Dear ***:

In your letter of January 12, you inquired about the taxability of services
performed on tools used in your manufacturing process.

You state that you use "tools" to inspect dimensions of parts that you
manufacture for resale. The "tools" that you use must also be "inspected" and
conform to certain requirements for accuracy, etc. Accordingly, you hire a
service company who visits your facility on a yearly basis. You also indicate
that our "tax representative" stated that these services aren't taxable.

The services that you describe appear to involve calibration of the tools. If
so, the total charge for services is taxable because calibration qualifies as
maintenance or repair of tangible personal property as defined in the enclosed
Comptroller's Rule 3.292 (Repair, Remodeling, Maintenance and Restoration of
Tangible Personal Property).

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

If you have any questions, please contact Tax Correspondence. You may call
toll-free at 1-800-252-5555, or our regular number is 512/463-4600. My
extension is 3-4662.

Sincerely,

Bob Jeffcoat
Tax Correspondence

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