Ezel / Tax Rulings / TX
TX 8507L0670E12 Sales and/or Use Tax (State,Local,MTA) 1985-07-25

Was corrugated metal pipe used for soil conservation on a farm or ranch exempt from Texas sales tax?

Short answer: No. The pipe was taxable, and the purchaser had to pay tax on its full purchase price; the described agricultural exemption covered qualifying machinery or equipment.

Apply this to your situation

This page answers the general question as of 1985. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1985
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official 1985 Texas Comptroller taxpayer-response letter limited to corrugated metal pipe used for soil conservation on a farm or ranch. It treats the pipe as taxable and contrasts it with the described agricultural exemption for qualifying machinery or equipment used exclusively in producing food for sale. The body cites no numbered statute or rule and expressly says different facts could change the opinion. Current agricultural, soil-conservation, pipe, machinery, equipment, purchase-price, and sales-tax rules may differ, and STAR documents may no longer represent current policy even when not marked superseded. Letters on STAR can support detrimental reliance only for the taxpayer to whom the letter was directly issued under 34 Tex. Admin. Code Rules 3.1 and 3.10. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

Corrugated metal pipe used for soil conservation on a farm or ranch was taxable. The purchaser had to pay tax on the pipe's entire purchase price.

The letter described the agricultural exemption as applying to machinery or equipment used exclusively on a farm or ranch to produce food for human consumption for sale in the regular course of business; it did not treat the pipe as qualifying.

Common questions

Did use on a farm or ranch automatically exempt the pipe? No.

How much of the purchase price was taxable? The total purchase price.

What did the described agricultural exemption cover? Qualifying machinery or equipment used exclusively in farm or ranch production of food for human consumption for sale.

Citations and references

The reproduced letter cites no numbered statute or rule.

Source

Original ruling text

July 25, 1985

Dear ***:

Thank you for your letter of July 15, 1985 concerning the taxability of
corrugated metal pipe used in soil conservation.

Pipe used on a farm or ranch is taxable. An agriculture exemption is
extended to machinery or equipment used exclusively on a farm or ranch in
the production of food for human consumption to be sold in the regular
course of business.

The purchaser is required to pay tax on the total purchase price of the
pipe.

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

If you have any questions or need more information, please call us at
1-800-252-5555 toll free from anywhere in Texas. You may write us at the
Tax Administration Division.

Sincerely,

Tax Policy Section
Tax Administration Division

Get today's answer for your situation

You just read a 1985 ruling on this question. Ezel checks current Texas tax law and answers your specific situation, with citations.

Opens in Ezel Pro. Every answer cites the authority it relies on.