Ezel / Tax Rulings / TX
TX 9007L1030G02 Sales and/or Use Tax (State,Local,MTA) 1990-07-16

Did electricity used for refrigeration during produce ripening count as exempt processing use, and did refrigeration used after ripening for storage qualify?

Short answer: Electricity for refrigeration used to ripen bananas, tomatoes, and other produce qualified as exempt processing use. Refrigeration used only to store already ripened produce was taxable use. The claimant needed records showing that processing was actually occurring.

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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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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

Electricity used for refrigeration while bananas, tomatoes, and other produce were being ripened qualified as exempt processing use.

Once the produce was ripe, refrigeration used merely for storage was taxable use. A claimant needed documentation showing that the refrigeration period involved processing rather than storage.

Common questions

Ripening refrigeration exempt? Yes.

Post-ripening storage refrigeration exempt? No.

Were records required? Yes, to establish that processing was occurring.

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, TEXAS 78774

BOB BULLOCK
Comptroller

July 16, 1990

Dear **:

Thank you for the additional information concerning the ripening
of bananas and tomatoes.

Based on the information presented, the electricity for refrig-
eration used for ripening the product (bananas, tomatoes and
other produce that requires ripening) qualifies as exempt use.
Any storage of the ripened produce is taxable use. The person
claiming exemption must have documentation on file to establish
that processing is occurring.

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

If you have any questions or need additional information, you may
call toll free 1-800-252-5555 or the regular number 512/463-4600.
My extension is 3-4666. You may write to Tax Correspondence, Comp-
troller of Public Accounts.

Sincerely,
Jo Ann Dieck
Tax Correspondence

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