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Ezel / Tax Rulings / TX
TX 9102L1072B09 Motor Vehicle Tax 1991-02-11

Did the 1991 federal luxury tax enter the taxable sales price for Texas motor vehicle tax?

Short answer: No, when the federal luxury tax was separately stated and identified on the invoice. In that circumstance, the 1991 letter said it did not become part of the vehicle's taxable sales price and was not subject to Texas motor vehicle tax.

Apply this to your situation

This page answers the general question as of 1991. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1991
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 Tax Administration letter dated February 11, 1991; STAR metadata lists February 1, but the printed date controls here. It addressed the then-new federal luxury tax and historical Texas vehicle-tax calculation. It predates modern Private Letter Ruling reliance terms and cannot bind the Comptroller for unrelated taxpayers. The federal tax, invoice requirements, Texas tax base, title fees, and registration procedures may have changed. The historical agency addresses and phone numbers should not be used without verification. 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 Texas Tax Administration Division said the federal luxury tax did not enter a motor vehicle's taxable sales price when the invoice separately stated and identified the federal charge.

In that circumstance, the federal amount was not subject to Texas motor vehicle tax. The letter referred federal-tax questions to the Internal Revenue Service and title or registration fee questions to the state highway department.

What this means for you

Vehicle dealers and buyers

Separate statement and identification controlled the historical exclusion. Verify current federal charges and Texas tax-base rules.

Common questions

Q: Was the federal charge excluded automatically?

A: The letter conditioned exclusion on separately stating and identifying it on the invoice.

Q: Did the letter decide title or registration fees?

A: No. It referred those questions to another agency.

Citations and references

  • The letter cited no federal or Texas statute or administrative rule by number.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

JOHN SHARP
Comptroller

February 11, 1991

Dear ** :

Thank you for your letter of January 25, 1991. As I understand it, you
wanted to know whether the new federal luxury tax affects the calcula-
tion of Texas motor vehicle taxes.

The federal luxury tax, when separately stated and identified on the in-
voice, does not become a part of the taxable sales price of a motor ve-
hicle, and is not subject to Texas tax.

More information about the luxury tax may be obtained from the Internal
Revenue Service. If you have questions about Texas Title or Registra-
tion fees, feel free to contact:

State Department of Highways and Public Transportation
Motor Vehicle Division
40th and Jackson
Austin, TX 78779

This opinion is based on the questions presented. Different questions,
though similar, might lead to different answers. If you have further
questions, feel free to write or call me at 1-800-531-5441, ext. 3-3889.

Sincerely,
John Christian
Tax Administration

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