Is a package of disposable products sold to hospitals for use in a heart-lung pump during open heart surgery exempt from Texas sales tax?

Subject

Open Heart Surgery Perfusion Package — Disposable Products Used In Heart/Lung Pump During Surgery

Plain-English summary

This short letter answers a hospital supplier's question about a "perfusion package" — a set of disposable products sold to hospitals for use in a heart-lung pump (also called a perfusion machine) during open heart surgery.

The Comptroller's answer is brief and direct: the package is exempt from Texas sales tax. The reasoning is that a heart-lung pump itself, along with its accessories and attachments, qualifies as an exempt prosthetic device, so the disposable products used with the pump during surgery share that exemption.

As with other letters of this era, the Comptroller notes the answer is based on the facts presented, and different facts (even if similar) could lead to a different result.

What this means for you

Sellers of hospital and surgical supplies

If you sell disposable perfusion products used in a heart-lung pump during open heart surgery, this letter indicates the Comptroller treats those items as exempt from Texas sales tax, on the theory that the pump and its accessories and attachments are exempt prosthetic devices.

Hospitals and healthcare purchasers

Hospitals purchasing a perfusion package for use in open heart surgery should not expect to pay Texas sales tax on it, based on this letter's reasoning that the heart-lung pump and its accessories are prosthetic devices.

Accountants and tax professionals

This is a narrow, facts-based letter about one specific product (a disposable perfusion package used with a heart-lung pump). It does not spell out a statute or rule number, and it does not address other surgical disposables generally — treat it as guidance on this specific product, not a blanket exemption for all hospital disposables.

Common questions

Q: Is a disposable perfusion package used with a heart-lung pump taxable in Texas?
A: No. According to this letter, the package of disposable products sold to hospitals for use in a heart-lung pump during surgery is exempt.

Q: Why is it exempt?
A: The letter explains that a heart-lung pump, along with its accessories and attachments, is exempt as a prosthetic device.

Q: Does the letter cite a specific statute or rule for this exemption?
A: No, the letter as provided does not name a specific statute or administrative rule; it simply states the conclusion that the pump and its accessories are exempt prosthetic devices.

Q: Could this answer change under different facts?
A: Yes. The letter states the opinion is based on the facts presented, and different facts, although similar, may result in a different answer.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9609L1436A14

Original ruling text

September 6, 1996

Dear ****:

Thank you for your letter dated September 4, 1996,
concerning the taxability of an open heart surgery perfusion package.

The package of disposable products sold to hospitals
for use in a heart lung pump during surgery is exempt. A heart lung pump, its
accessories and attachments are exempt as prosthetic devices.

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 9609683L