Are kidney dialysis machines and the accessory equipment used alongside them (recliner, scale, blood pressure device, calibration equipment, water treatment system, reuse machine) exempt from Texas sales tax?

Plain-English summary

The Texas Comptroller's Tax Policy Division responded to a letter dated October 21, 1995, asking about the taxability of kidney dialysis machines and the accessory medical equipment that must be provided and used alongside a dialysis machine to carry out a dialysis procedure.

The Comptroller went item by item through the accessory equipment described in the request:

• Dialysis recliner (a specially designed chair that can go into Trendelenburg position if the patient's blood pressure drops severely during treatment) — taxable.
• Scale (used to weigh the patient at least twice per treatment to measure the treatment outcome) — taxable.
• Blood pressure device and thermometer (used to measure blood pressure and temperature changes frequently during the procedure) — taxable.
• Calibration equipment (used to calibrate the monitoring parameters of each dialysis machine for safe, accurate treatment) — taxable.
• Water treatment system (a comprehensive system that purifies the water used for the hemodialysis procedure) — exempt.
• Reuse machine (an automated machine used to reprocess, i.e., clean, each patient's hemodialyzer/artificial kidney after dialysis) — taxable, because the Comptroller understood this equipment to be used to clean the artificial kidney after dialysis rather than during the treatment itself.

The Comptroller's general rule: kidney dialysis machines and related supplies are exempt when the equipment is specifically designed and used during dialysis treatment, but supplies and equipment that could have multiple uses — items that could be used during dialysis as well as during other treatments — are not exempt. The letter also cautions that this opinion is based on the facts presented, and different facts, though similar, may result in different answers.

What this means for you

Dialysis clinics and providers buying equipment

Don't assume that everything used "for dialysis" is tax-exempt. Under this letter, the exemption is narrow: it covers the dialysis machine itself and the water treatment system that purifies water specifically for the hemodialysis procedure. General-purpose monitoring and support equipment — recliners, scales, blood pressure devices, thermometers, and calibration equipment — is taxable because it could be used in other medical contexts, not just during dialysis.

Vendors selling dialysis-related equipment

If you sell equipment to dialysis providers, you'll need to determine, item by item, whether what you're selling is specifically designed and used during the dialysis treatment itself (potentially exempt) versus general medical equipment with other possible uses (taxable), and collect tax accordingly on the taxable items.

Anyone relying on this letter

This is a 1995 letter ruling addressing specific accessory equipment described by one taxpayer. It doesn't establish a blanket exemption for "dialysis supplies" generally — the taxable/exempt line depends on whether an item is dedicated to use during the dialysis procedure or has broader medical uses.

Common questions

Q: Is the kidney dialysis machine itself exempt from Texas sales tax?
A: Yes. The letter states that kidney dialysis machines and related supplies are exempt when the equipment is specifically designed and used during dialysis treatment.

Q: Is the water treatment system used for hemodialysis exempt?
A: Yes. The Comptroller specifically found the comprehensive water treatment system that purifies water for the hemodialysis procedure to be exempt.

Q: Are the dialysis recliner, scale, blood pressure device, thermometer, and calibration equipment exempt?
A: No. All of these were found taxable, because they are the kind of equipment that could be used during dialysis as well as during other medical treatments.

Q: What about the machine used to clean and reprocess the artificial kidney (hemodialyzer)?
A: The reuse machine was ruled taxable. The Comptroller understood it to be used to clean the artificial kidney after dialysis, not during the treatment itself.

Q: Can another taxpayer rely on this specific letter?
A: This opinion is based on the facts presented, and the letter itself notes that different facts, although similar, may result in different answers.

Citations and references

No specific statutes or administrative rules were cited in the text of this letter.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9510L1378D11

Original ruling text

October 31, 1995

Dear *****:

Thank you for your letter dated October 21, 1995, concerning
the taxability of kidney dialysis machines and supplies.

Facts: Accessory medical equipment (identified below) must
be provided and utilized along with a kidney dialysis machine
in order to carry out a dialysis procedure.

_ Dialysis recliner - patient must sit in a specially designed
dialysis chair that will go into Trendelenburg position in the
event of severe blood pressure drop during the procedure.
Response: Taxable.

_ Scale - weight must be obtained at least twice for each
dialysis treatment in order to measure the treatment outcome.
Response: Taxable.

_ Blood pressure device and thermometer - blood pressure must
be measured frequently during the dialysis procedure along with
patient's temperature changes. Response: Taxable.

_ Calibration equipment - the monitoring parameters of each
dialysis machine must be calibrated for a safe and accurate
delivery of dialysis treatment. Response: Taxable.

_ Water treatment system - a comprehensive water treatment
system must be operating at the same time to purify the water
used for hemodialysis procedure. Response: Exempt.

_ Reuse machine - an automated reuse machine must be utilized
for reprocessing each dialysis patient's hemodialyzer (artificial
kidney). Response: It is our understanding that this equipment is
used to clean the artificial kidney after dialysis; therefore, it
is taxable.

Kidney dialysis machines and related supplies are exempt when
the equipment is specifically designed and used during dialysis
treatment. Supplies and equipment that may have multiple uses are
not exempt (items that could be used during dialysis as well as
during other treatments).

This opinion is based on the facts presented and current law.
Different facts although similar, may result in different answers.

If you have any questions or need more information, you may
call me toll free at 1-800-531-5441, ext. 50330. The direct line
is 512/475-0330. You may also write to Tax Policy Division,
Comptroller of Public Accounts.

Sincerely,

Bettie Peterson
Tax Policy Division

NOTE: Previous Accession Number 9510667L