200805132L



From: Al Van Allen 
Sent: Friday, May 16, 2008 2:20 PM
To: **************
Subject: 08136723 RE: Use Tax on Rabies Tags


May 16, 2008

**************

Dear Taxpayer:

Thank you for your recent email regarding the sales tax treatment of rabies 
tags that you buy from various cities. You state that the cities do not charge 
you sales tax so you self-accrue and remit the use tax. You believe that 
governmental agencies are exempt from charging sales tax and ask if you are 
required to remit tax on your purchases of the tags.

Response: Tax Code Chapter 151 imposes sales tax on sales of tangible personal 
property and 17 broad categories of taxable services unless an exemption 
applies. Government agencies are not exempt from charging sales tax on their 
sales of taxable items. However, they are not required to collect sales tax on 
sales of tangible property when the item sold is actually a license or permit. 
A motor vehicle license plate is a good example of this.

This also applies to rabies tags that are actually permits or licenses for dogs 
within the corporate limits of a municipality or county. Accordingly, the tags 
may be purchased tax free and are not taxed when transferred to a dog owner by 
a veterinarian as part of vaccinations required by law.

This opinion is based on the facts you presented.  Other facts, though similar, 
may yield different results.

If you need more information, please email tax.help@cpa.state.tx.us, or call 
toll-free 1-800-531-5441.

Our goal is to provide you with prompt, professional service.  Please take a 
moment to complete our on-line survey at 
http://aixtcp.cpa.state.tx.us/surveys/tpsurv2/index.html.

Sincerely,


Al Van Allen
Program Specialist
Tax Policy Division
Comptroller of Public Accounts



Original Message
From: **************
Sent: Wednesday, May 14, 2008 3:28 PM
To: Tax Help
Subject: Use Tax on Rabies Tags


Dear Sir or Madam:

We own and operate a veterinary hospital. We purchase animal tags directly from 
cities in Texas and we are not charged sales tax. We self-accrue use tax on 
these tags and remit use tax to the state of Texas.

I believe we are doing this incorrectly and we do not need to self-accrue use 
tax since we are purchasing tags from a governmental agency that is not 
required to charge sales tax. Please advise at your earliest convenience.

Thank you.


**************




ACCESSION NUMBER: 200805132L
SUPERSEDED: N
DOCUMENT TYPE: L
DATE: 05/16/2008
TAX TYPE: SALES