Ezel / Tax Rulings / TX
TX 8603L0707E14 Sales and/or Use Tax (State,Local,MTA) 1986-03-21

Were separately stated charges for assembling rented board roads at the job site taxable?

Short answer: Yes. Texas reversed its prior installation treatment and required tax on board-road assembly charges for contracts made on or after March 21, 1986.

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This page answers the general question as of 1986. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1986
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 Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
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

Board-road rental companies either transported lumber and built the road at the rental site or transported prefabricated sections and nailed them together there.

The Comptroller said it had previously treated separately stated installation charges as nontaxable. After reconsideration, it classified the on-site work as assembly rather than nontaxable installation. The rental companies therefore had to collect tax on board-road assembly charges for contracts entered into on or after March 21, 1986, the date of the letter.

Common questions

Did separately stating the assembly charge make it nontaxable? No.

What kinds of work did the letter cover? Building a road from transported lumber at the site and nailing transported road sections together at the site.

When did the changed treatment apply? To contracts entered into on or after March 21, 1986.

Citations and references

The reproduced letter does not cite a statute or rule.

Source

Original ruling text

March 21, 1986

Dear ***:

I understand we wrote on you on October 14, 1982, concerning tax on
board road rentals.

Since you have clients in the business of rental board roads, I'd like
to take a minute to explain a change in the amount subject to tax on board
road rentals.

Some board road rental companies transport lumber to the rental site and
construct or assemble the road on site. Other board road rental companies
transport sections of the road to the rental site and assemble the road
by nailing the sections together.

In the past we have said separately stated charges for installation are
not subject to tax. Upon closer examination, we have determined that board
road rental companies assemble the road on site and the charge for
assembling the road is taxable. Your clients will be responsible for
collecting tax on any charges for assembling the board road on contracts
entered into on or after the date of this letter.

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

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