Ezel / Tax Rulings / TX
TX 9103L1094C06 Sales and/or Use Tax (State,Local,MTA) 1991-03-19

Was the sale of a blood autotransfuser to a Texas hospital taxable when the hospital used it in patient care?

Short answer: Yes. The hospital was the consumer of taxable patient-care items, so the equipment sale was taxable unless the hospital supplied a valid exemption certificate.

Apply this to your situation

This page answers the general question as of 1991. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1991
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 Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded.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 Comptroller said the sale of a blood autotransfuser to a hospital was taxable. Hospitals were treated as the consumers of taxable items used in patient care, whether their patient billing was separated or lump-sum.

The patient was not buying the equipment from the hospital; the patient was paying for hospital services. If the hospital itself qualified as an exempt entity, the seller could accept a properly completed, valid exemption certificate instead of collecting tax.

What this means for you

Under this 1991 letter, a hospital's use of equipment in providing patient services did not make the equipment a resale to the patient. The equipment seller needed either to collect tax or receive a valid exemption certificate from a qualifying hospital.

Common questions

Was the autotransfuser sale taxable? Yes.

Did separately billing the patient change the hospital's status? No. The letter treated the hospital as the consumer whether billing was separated or lump-sum.

Was the patient buying the equipment? No. The letter said the patient was paying the hospital for services performed.

Could an exempt hospital buy without tax? Yes, if it provided the seller with a properly completed, valid exemption certificate.

Citations and references

The letter did not cite a numbered statute or rule.

Source

Original ruling text

March 19, 1991

Dear ***:

Thank you for your letter regarding the taxability of a blood
autotransfuser.

Hospitals are considered the consumers of taxable items used in
patient care whether the billing is separated or lump-sum. The
patient is not making a purchase of equipment from the hospital
but is paying the hospital for services performed.

The sale of a blood autotransfuser to a hospital is taxable. If
the hospital qualifies as an exempt entity; you may accept in lieu
of tax a properly, completed valid exemption certificate from them.

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

You may write to Tax Administration Division, Comptroller of
Public Accounts.

Sincerely,

Tax Administration Division

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