Did work chaps used strictly for farm and ranch jobs qualify for Texas's agricultural sales-tax exemption?

Plain-English summary

The Texas Comptroller said work chaps did not qualify for the agricultural sales-tax exemption, even when used strictly on a farm or ranch for gathering, feeding, branding, fencing, or haying work.

The seller compared chaps to exempt ranch equipment, but the response grouped them with boots and broad-brimmed hats as useful items that nevertheless did not qualify. The seller was told it could back-bill customers for the tax.

What this means for you

Essential use in agricultural work did not by itself establish exemption. The item's legal classification, not merely how important it was to the ranch job, controlled the result.

Common questions

Were work chaps exempt agricultural equipment? No.

Did strict farm or ranch use change the answer? No.

Could the seller recover tax from customers? The letter said it could back-bill them.

Citations and references

• Tex. Tax Code § 151.316 — the agricultural-items provision raised by the taxpayer.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8701L0788A08

Original ruling text

January 9, 1987

Dear ***:

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

In our recent audit, we were required to pay tax on work chaps. In the
past, we have always collected tax on show chaps and rodeo chaps, these
being non-agriculture related items. We wish you to consider your
non-existent opinion on this item.

In your list of agricultural exempt items, you do not list work chaps. By
going to Section 151.316 agricultural items, we did not charge tax on
work chaps.

Work chaps are used strictly on a farm or ranch as a part of their
equipment. Chaps are not worn as an everyday piece of clothing. They
are used when the job to be done requires them, such as gathering
cattle, feeding cattle, branding, fencing, or haying. They are used
simultaneously with exempt items such as saddles, fencing, pliers,
bonuses, ropes, etc. Chaps are as much as a piece of equipment to a
cowboy as his saddle or bridle.

Please consider these facts upon making a decision.

Response:
Chaps are important to a cowboy when working livestock in brush. Boots
and a broad brimmed hat are also important. However, none of these
items qualify for the agricultural exemption. You may back bill your
customers for the tax.

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

Sincerely,

Al Van Allen
Tax Policy Section
Tax Administration Division