Were multiday Rio Grande rafting trips exempt because they crossed into Mexico and sometimes camped outside Texas?

Plain-English summary

The operator offered Rio Grande rafting trips lasting from one day to seven days. The longer trips crossed the international boundary several times and could camp on either the Mexican or United States side, at the group leader's choice.

The Comptroller treated the rafting trips as taxable amusement services. A trip could be exempt only if it lasted longer than 24 hours and the group remained outside Texas territorial limits.

Crossing the boundary or occasionally camping in Mexico was not enough. The letter compared yacht cruises on a Texas border lake, which were taxable because they were not offshore outside Texas waters.

What this means for you

Duration alone did not create the exemption. The trip also had to remain outside Texas, making the actual route and location decisive.

Common questions

Were one-day rafting trips taxable? Yes.

Did a two-to-seven-day trip automatically qualify for exemption? No.

Did crossing into Mexico several times make the trip exempt? No. The group had to remain outside Texas territorial limits for a trip longer than 24 hours.

Citations and references

The letter did not cite a specific statute or rule.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9104L1108A07

Original ruling text

April 24, 1991

Dear ***:

Thank you for your letter concerning your Rio Grande river rafting trips.

You stated in your letter that you agree that single day trips are
clearly taxable. You also said that the trips that last two to seven days
should not be taxable because the international boundary between Mexico and the
United States is crossed several times during a trip and the group camps
overnight on either the Mexican side or the United States side of the river.
Your brochure said the camp choice is the prerogative of the group leader.

Your river rafting trips are subject to Texas sales tax as amusement
services. Only those trips that last longer than 24 hours with the group
remaining outside of the territorial limits of Texas can be considered exempt
from Texas tax. Yacht cruises on "a large lake located on the border of Texas"
were determined to be taxable because the cruises were not "offshore" outside
Texas waters.

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

Please feel free to contact me if you have any additional questions. You
may write me, call toll free 1-800-252-5555 from anywhere in the United States
or phone 512/463-4600.

Sincerely,

Julie Pesl
Tax Administration Division