If a janitorial vendor bills separately for general building cleaning and for special decontamination cleaning inside a semiconductor cleanroom, is the cleanroom-specific charge exempt from Texas sales tax?

Plain-English summary

A semiconductor manufacturer's janitorial vendor billed two separate line items: one for general building janitorial services, and a second for daily cleaning inside the facility's cleanrooms. The cleanroom-specific service required a day porter to don protective smocks over his head, body, and shoes before entering — because even trace foreign particles could contaminate the cleanroom and destroy sensitive semiconductor products — and involved vacuuming or removing floor mats containing dust and particles and mopping the cleanroom floors, all aimed at decontaminating the space.

The Comptroller confirmed general building janitorial services are a taxable service under 34 TAC § 3.356(a)(7) — that line item stays taxable. But the second line item, the cleanroom decontamination cleaning, is exempt. The legal hook is Tax Code § 151.3111(a): a service performed on tangible personal property is exempt if that property, had it instead been sold, leased, or rented at the time of the service, would itself have been exempt because of its nature or use. Since Tax Code § 151.318(b)(2) exempts semiconductor cleanrooms and equipment, and § 151.318(q) extends that exemption to all qualifying tangible personal property whether or not it's affixed to or incorporated into realty, the cleanroom itself is exempt property — so cleaning services performed on it are also exempt.

What this means for you

Semiconductor manufacturers buying janitorial services

Ask your janitorial vendor to separately bill cleanroom-specific decontamination cleaning from general building janitorial services. The general building cleaning stays taxable, but the cleanroom-specific service can be exempt under the same logic that exempts the cleanroom equipment itself.

Janitorial and facilities service providers serving fabs

If you perform genuinely distinct decontamination work inside a semiconductor cleanroom — different procedures (protective gowning), different purpose (contamination control, not general tidiness) — bill it as a separate line item to preserve the exemption; bundling it into one general janitorial charge risks losing that distinction.

Accountants and tax professionals

This is a companion example to the broader semiconductor cleanroom exemption line of rulings (see the related "clean rooms and equipment" letters from the same period): § 151.3111(a)'s "service on otherwise-exempt property" principle extends the § 151.318 cleanroom exemption to services performed on the cleanroom, not just to purchases of cleanroom equipment itself.

Common questions

Q: Is all janitorial service at a semiconductor facility exempt?
A: No — only the portion specifically performed inside the exempt cleanroom environment for decontamination purposes. General building janitorial services remain taxable under 34 TAC § 3.356(a)(7).

Q: What's the legal basis for exempting the cleanroom cleaning?
A: Tax Code § 151.3111(a) exempts services performed on property that would itself be exempt because of its nature or use — and the cleanroom itself is exempt property under § 151.318(b)(2) and (q).

Q: Does the cleanroom cleaning need to be billed separately to be exempt?
A: This letter's facts involve a vendor billing the two services as separate line items, which is what let the Comptroller cleanly split taxable general janitorial from exempt cleanroom decontamination.

Q: Can any semiconductor fab rely on this exact split?
A: Not directly. This is a Texas STAR letter ruling binding on the Comptroller only for the taxpayer it addresses (34 Tex. Admin. Code Rules 3.1, 3.10); confirm your own service billing structure with a tax professional.

Citations and references

Statutes and rules:

• Tex. Tax Code § 151.3111(a) (exemption for services on exempt property)
• Tex. Tax Code § 151.318(b)(2), (q) (semiconductor fabrication cleanrooms and equipment)
• 34 Tex. Admin. Code § 3.356(a)(7) (taxable janitorial services)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/200011921L

Original ruling text

November 21, 2000

Subject: Services to Clean Rooms at a Semiconductor Facility

Dear **:

Thank you for your recent letter concerning the taxability of services
performed on clean rooms.

Information Provided:

Company A is a purchaser of janitorial services from a particular vendor. The
janitorial services consist of two line-item billings. The first line item
represents janitorial services for the entire building. We understand that
this is a taxable service as defined by Rule 3.356(a)(7). The second line item
is a billing for daily services provided to clean the clean rooms at the
semiconductor manufacturer's facility. This particular service consists of a
day porter placing protective smocks over his head, body, and shoes before
entering into the clean room. The reason for this procedure is because the
slightest amount of foreign particles could contaminate the clean room
destroying sensitive products while the day porter is performing services
inside of the clean room. Once the porter enters the clean room, he vacuums or
removes floor mats that contain dust and foreign particles. The porter also
mops the floors in the clean room to remove foreign items as well. The basic
purpose of this particular service is to decontaminate the clean room area.

Question: Is the second line item for daily services exempt from sales and use
tax as an item relating to exemptions for clean rooms at a semiconductor
facility as defined in Section 151.318(q)?

Answer: The second line item, a charge for cleaning the clean room, is exempt.
Texas Tax Code Section 151.3111(a) states: "[a] service that is performed on
tangible personal property that, if sold, lease, or rented, at the time of the
service, would be exempted under this chapter because of the nature of the
property, its use, or a combination of its nature or use."

Texas Tax Code Section 151.318(b)(2) exempts semiconductor clean rooms and
equipment. Texas Tax Code Section 151.318(q) states that the exemption
provided in Section 151.318(b)(2) extends to all tangible personal property
without regard to whether the property is affixed to or incorporated into
realty.

You may view or down load the sales tax law by clicking on the following URL
and then click on the following:

1. Texas Taxes
2. Tax Code under Texas Laws and Rules
3. Tax Code
4. Scroll down to referenced statutory cite

This opinion is based on the facts presented. If there are additional or
different facts, the opinion may change.

You may call me toll free 1-800-531-5441, extension 3-4683, if you have any
questions or need more information. You may write to Tax Policy Division,
Comptroller of Public Accounts, P.O. Box 13528, Austin, Texas 78711-3825. My
email address is

Sincerely,

Eddie C. Washington
Tax Policy Division