Ezel / Tax Rulings / TX
TX 9004L0999G07 Sales and/or Use Tax (State,Local,MTA) 1990-04-24

Were charges taxable when the City of Huntsville operated a central burglar-alarm monitoring facility in its police station?

Short answer: No. The Comptroller ruled that the city's alarm-monitoring charges were not subject to sales tax because Texas political subdivisions were exempt from licensing under the Private Investigators and Private Security Agencies Act.

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This page answers the general question as of 1990. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1990
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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

The City of Huntsville operated a central burglar-alarm monitoring facility in its police station. The Comptroller ruled that the city's monitoring charges were not subject to sales tax.

The stated reason was that political subdivisions of Texas were exempt from licensing under the Private Investigators and Private Security Agencies Act. The letter does not extend that conclusion to privately operated alarm companies.

Common questions

Were the city's alarm-monitoring fees taxable? No.

Why were they not taxable? The Comptroller relied on the licensing exemption for political subdivisions under the private-security law.

Did the ruling cover a private alarm company? No. Its facts concerned a city-operated monitoring facility.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller April 24, 1990

Director of Finance
City of Huntsville
1212 Avenue M.
Huntsville, TX 77340

Dear ***:

I just want to take a minute to respond to your question on
the City of Huntsville operating a central burglar alarm
monitoring facility in the police station.

Your charges for monitoring alarm systems are not subject to
sales tax. The reason is that political subdivisions of the
state are exempt from being licensed under the "Private
Investigators and Private Security Agencies Act."

This opinion is rendered based on the facts you presented.
other facts, though similar, may yield different results.

Feel free to call or write me if you have questions. You
can reach me by calling toll free 800-531-5441 or FAX (512)
475-0900.

Sincerely,
Al Van Allen
Taxability Section
Legal Services Division

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