Ezel / Tax Rulings / TX
TX 8511L0683G06 Sales and/or Use Tax (State,Local,MTA) 1985-11-26

Were well logging, perforating, bridge-plug setting, cementing, and mast-truck services taxable in Texas?

Short answer: The listed wire-line well services were nontaxable; mast-truck service followed the underlying job, while a bare mast-truck rental was motor-vehicle taxable.

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 classifying specific wire-line well services, mast-truck service, and a bare mast-truck rental. It expressly says different facts could change the opinion. Current oilfield-service, motor-vehicle, equipment-rental, well-work, bundling, and sales-tax rules may differ, and STAR documents may no longer represent current policy even when not marked superseded.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

The Comptroller classified well logging, shooting or perforating a well, setting bridge plugs, and cementing on a well as nontaxable services.

Providing a mast truck was nontaxable when the truck was used to perform a nontaxable service and taxable when used for a taxable service. A bare rental, where the wire-line company did not use the mast truck in any way, was taxable under the motor vehicle tax law.

Common questions

Were logging and perforating taxable? No.

Were bridge-plug setting and cementing taxable? No.

How was mast-truck service treated? It followed the tax treatment of the service being performed.

Was a bare mast-truck rental taxable? Yes, under the motor vehicle tax law stated in the letter.

Citations and references

  • Texas Comptroller Rule 3.324 — enclosed for reference.

Source

Original ruling text

November 26, 1985

Dear ***:

In reply to ***'s letter of November 18, 1985, I will specify
the tax applicable to the following services performed by a wire-line
service company:

  1. Logging wells - not taxable
  2. Shooting or perforating a well - not taxable
  3. The setting of bridge plugs - not taxable
  4. Cementing on a well - not taxable
  5. Providing a mast truck (mast truck services) Not taxable if the mast
    truck is being used to perform a nontaxable service. Taxable if the mask
    truck is being used to perform a taxable service.
    6.Rental of a mast truck - If this is a bare rental and the wire line
    service company is not using the mast truck in any form or fashion, this
    rental will be taxable under the motor vehicle tax law.

Enclosed is Rule 3.324 for your reference.

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

Please feel free to contact us if you have additional questions. You may
write us, call toll free 1-800-252-5555 from anywhere in Texas.

Sincerely,

Tax Policy Section
Tax Administration Division

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