Ezel / Tax Rulings / TX
TX 8611L0774D02 Sales and/or Use Tax (State,Local,MTA) 1986-11-13

Could a basketball team collect and remit tax for tickets sold through third-party outlets, and did handling charges enter the taxable price?

Short answer: Yes. The team was authorized to assume collection and remittance, but tax had to be based on the outlet's actual selling price, including handling charges.

Apply this to your situation

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 1986 Texas Comptroller letter authorizes one basketball organization to assume tax collection and remittance for tickets sold through specified outlets and includes outlet handling charges in the selling price. Ticket, amusement, marketplace, agent, handling, convenience, reservation, collection, sourcing, and local-tax rules may have changed or differ for another seller. STAR documents may no longer represent current policy even when not marked superseded. Identities 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 Texas Comptroller authorized the basketball team to assume responsibility for collecting and remitting tax on its tickets sold through third-party outlets.

Tax had to be computed on the outlet's actual selling price, including handling charges.

What this means for you

Centralizing remittance with the team did not remove outlet-added charges from the tax base. The customer-facing selling price controlled.

Common questions

Could the team remit tax for outlet sales? Yes.

What price was taxed? The outlet's actual selling price.

Were handling charges included? Yes.

Citations and references

  • The letter cited no numbered statute or Comptroller rule.

Source

Original ruling text

November 13, 1986

Dear ***:

Thank you for your recent letter which is restated with the response
below.

The purpose of this letter is to request written authorization from your
office for the Basketball Team to assume responsibility for the tax
collection and remittance of Basketball Team's tickets sold through
Company A Outlets.

Please respond to this request at your earliest convenience, as time is
of the essence.

Response:
Your organization is authorized to assume responsibility for tax
collection and remittance of Basketball Team's tickets sold through Company
A Outlets. However, to provide for the efficient administration of the tax,
we have determined that you must collect and remit tax based on Company A
actual selling price including handling charges.

If you have any questions or need more information, please call us at
1-800-252-5555 toll free from anywhere in Texas. The regular number is
512/463-4600. You may write us at the Tax Administration Division.

Sincerely,

Tax Policy Section
Tax Administration Division

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