Was writing 'Paid by cash' on a customs-broker export certificate and obtaining the customer's signature enough to document a Texas sales-tax refund?

Plain-English summary

The retailer asked whether it could document a cash sales-tax refund to a Mexican customer by writing "Paid by cash" on a U.S. Customs Broker certification and obtaining the customer's signature. The customer also returned with the retailer's original invoice and a valid broker certification showing that the goods had been exported to Mexico.

The Comptroller answered no. Under subsection (6) of Rule 3.323, the words "Paid by Cash" and the customer's signature did not create a sufficient receipt. The receipt also had to state the amount of cash received, show that the payment was a tax refund arising from export of identified items, show the refund date, and include the purchaser's name, address, and signature.

What this means for you

Proof that goods were exported and proof that the customer received a tax refund were separate recordkeeping issues in this letter. The retailer needed a receipt documenting the refund itself, not merely a general cash-payment notation on the export certificate.

This is a 1991 fact-specific letter. Retailers processing export-related refunds should verify the current version of Rule 3.323 and retain records matching current Comptroller requirements.

Common questions

Was the broker's export certification enough by itself? No. The question assumed a valid certification, but the Comptroller still required a sufficient receipt for the cash refund.

Was "Paid by cash" plus the customer's signature enough? No.

What amount had to appear on the receipt? The amount of cash the customer received.

What other information was required? The receipt had to identify the payment as a tax refund for specifically exported items, state the refund date, and include the purchaser's name, address, and signature.

Citations and references

• 34 Tex. Admin. Code Rule 3.323(6), cited as the source of the refund-receipt requirements.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9108L1126B10

Original ruling text

August 12, 1991

Dear ****:

Thank you for your recent question regarding cash refunds
made to Mexican citizens who return to your store with an original invoice from
a sale you made and a valid certification from a U.S. Customs Broker showing
the goods have been exported to Mexico. You ask if refunding the tax in cash
is acceptable if you write on the custom broker certification "Paid by cash"
and the customer signs. The answer is no. The term "Paid by Cash" the
customer's signature do not constitute sufficient receipt from the customer to
meet the requirements of subsection (6) of Rule 3.323. The customer must show
the amount of cash received and that it was a tax refund resulting from the
export of certain specific items. The receipt must show the date the refund was
made and include the name, address, and signature of the purchaser.

I am enclosing a copy of Rule 3.323 for your files.

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

If you have questions or need more information, please call
or write. You may reach me by calling toll free, (800) 531-5441. My direct
line number is (512) 463-4680. The number for FAX transmissions is (512)
475-0900. You may write to me in care of Tax Administration Division.

Sincerely,

Al Van Allen
Tax Administration Division