electrical
and natural gas predominant use tax studies
About
Texas utilities sales and use tax
Back
in 1961, the Texas state legislature passed a state sales tax
law that required a taxation on the purchase of tangible personal
property. The law intended for the end purchaser to be the one
to pay this tax. Because of this Texas law, any material or
tangible property that is purchased for use in manufacturing,
fabricating or processing a new or refurbished product may be
purchased without state sales taxation. Electricity and natural
gas that is purchased for this purpose in the state of Texas
is considered to be tangible property and is exemptable by the
State Comptroller.
Do
you have to pay tax on your utilities?
The
state of Texas either requires or allows utility companies to
charge their clients state sales tax, city tax, MTA tax or specialty
tax on all electrical and natural gas meters that are used for
commercial purposes. However, certain procedures are allowed
exemption status from the state sales taxation on utilities.
Electricity and natural gas used in manufacturing, fabricating
or processing can be exempted from this taxation as long as
over 50% of each of the electrical and natural gas meter's consumption
is used in making a physical or chemical change to the product
that is intended for sale. (Many factors determine exemptable
and non-exemptable use). A Predominant
Use Study is required to prove exempt status.
Utility
Discounters will perform a balanced utility
study in order to show the state the exact amount of exemptable
use. This will allow us to file for tax exemption status on
your utilities.
If
you have a nursing home facility, apartment complex or assisted
living complex click
here.
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errors can occur. Utility Discounters assumes no liability or
responsibility for any errors or omissions in the content contained
on this site or on sites linked to from this site.
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Discounters
