Ezel / Tax Rulings / TX
TX 8909L0958F12 Sales and/or Use Tax (State,Local,MTA) 1989-09-06

Was a city's separately stated $1.10 administration charge taxable as part of a $7.20 garbage-collection bill?

Short answer: Yes. The total amount charged for garbage collection was taxable, including the $1.10 city administration cost. Separately listing the fee did not remove it from the taxable service charge.

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This page answers the general question as of 1989. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1989
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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

A city charged $7.20 for garbage collection, including a separately identified $1.10 administration cost.

The administration charge was taxable because the total amount a seller charged for garbage collection was subject to sales and use tax. Listing the administrative cost separately on the bill did not change the result.

Common questions

Was the $1.10 administration fee taxable? Yes.

Did separately stating it make it exempt? No.

What total garbage charge did the letter describe? $7.20.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller September 6, 1989

Dear ***:

Thank you for your letter concerning garbage collection services.
According to your letter, of the $7.20 that your city bills you
for garbage collection services, $1.10 is an administration cost
charged by the city. You are questioning whether the $1.10 is
taxable for sales and use tax purposes.

The $1.10 administration cost charged by the city is taxable for
sales and use tax purposes. The total amount a seller charges a
customer for garbage collection services is taxable for sales and
use tax purposes. It wouldn't matter if the city listed the
administration costs separately on your bill, the total charge for
garbage collection services is taxable.

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

If you have any questions, please contact Tax Correspondence. You
may call toll-free 1-800-252-5555, or our regular number is
512/463-4600. My extension is 3-4658.

Sincerely,
Sherry Buckley
Tax Correspondence

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