Are aircraft maintenance manuals that contain the procedures and instructions mechanics must follow exempt from Texas sales and use tax?

Plain-English summary

The requester makes maintenance instructions required under Federal Aviation Regulations (FAR) 121, which governs commercial airline operations. Under those federal rules, each 121 operator must keep a complete and accurate set of documentation covering maintenance of its fleet, and a mechanic may not perform a maintenance operation unless it follows the documented procedures. The airlines using these manuals treat them as tools used to perform maintenance on aircraft.

The Comptroller agreed with that characterization for this type of manual. Texas Tax Code Section 151.328(d) exempts machinery, tools, and equipment used or consumed exclusively in the repair, remodeling, or maintenance of aircraft, aircraft engines, or aircraft component parts by or on behalf of a certified or licensed carrier of persons or property. The Comptroller concluded that a manual containing the maintenance procedures and instructions for the aircraft meets the definition of a "tool" or "equipment" for an aircraft mechanic, so it can qualify for that exemption.

The letter draws a line, though: not every manual qualifies. A manual that simply provides for record keeping of procedures that have already been performed or completed — as opposed to instructing the mechanic on how to do the maintenance — may not meet the definition of a tool or equipment.

What this means for you

Companies that produce or sell aircraft maintenance manuals

If your manual sets out the procedures and instructions a mechanic must follow to perform maintenance required under FAR 121 (or similar regulatory schemes), the Comptroller has treated that kind of manual as a "tool" or "equipment" of the mechanic, which can qualify for the Section 151.328(d) exemption when used by or on behalf of a certified or licensed carrier. Manuals that are purely record-keeping logs of work already done are treated differently and may not qualify.

Airlines and maintenance providers buying these manuals

Because the exemption in Section 151.328(d) is tied to use "by or on behalf of a certified or licensed carrier of persons or property" in repairing, remodeling, or maintaining aircraft, engines, or component parts, the exempt treatment described here is specific to that maintenance context — not to manuals bought for other purposes.

Accountants and tax professionals

This letter is a useful data point on how the Comptroller applies the "tools or equipment" language in Section 151.328(d) to informational/instructional products rather than physical hand tools, but it explicitly cautions that different facts, even if similar, may produce a different answer.

Common questions

Q: Are aircraft maintenance manuals exempt from Texas sales tax?
A: According to this letter, a manual containing the procedures and instructions a mechanic must follow to maintain an aircraft can qualify as an exempt "tool" or "equipment" under Texas Tax Code Section 151.328(d).

Q: Does that exemption apply to every kind of manual?
A: No. The letter specifically says other manuals may not qualify — for example, one that simply keeps records of maintenance procedures already performed rather than instructing how to perform them.

Q: What is the legal basis for the exemption?
A: Texas Tax Code Section 151.328(d), which exempts machinery, tools, and equipment used or consumed exclusively in the repair, remodeling, or maintenance of aircraft, aircraft engines, or aircraft component parts by or on behalf of a certified or licensed carrier of persons or property.

Q: Can I rely on this letter for my own manuals or business?
A: This opinion is based on the facts presented to the Comptroller, and the letter itself notes that different facts, though similar, may result in different answers.

Citations and references

Statutes and rules:

• Tex. Tax Code § 151.328(d) (exemption for machinery, tools, and equipment used in aircraft repair, remodeling, or maintenance by or on behalf of a certified or licensed carrier)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9509539L

Original ruling text

September 21, 1995

Dear *****:

Thank you for your letter dated September 14, 1995, concerning the taxability
of aircraft maintenance manuals.

According to Federal Aviation Regulations (FARs) 121, covering commercial
airline operations, each 121 operator must maintain a complete and accurate set
of documentation covering the maintenance of their fleet. Additionally, under
the regulations, a mechanic may not perform a maintenance operation that is not
in accordance with the documented maintenance procedures. ***** produces
the maintenance instructions required under FAR 121.

Airlines consider the manuals to be tools used in the performance of
maintenance services upon aircraft and as such, should be exempt under Texas
Tax Code Section 151.328(d) that exempts machinery, tools, and equipment used
or consumed exclusively in the repair, remodeling, or maintenance of aircraft,
aircraft engines, or aircraft component parts by or on behalf of a certified or
licensed carrier of persons or property.

Comptroller Response: The manual that contains the maintenance procedures and
instructions for the aircraft meets the definition of a "tool" or "equipment"
for an aircraft mechanic.

Other manuals may not qualify as a tool or equipment of the mechanic, for
example a manual that simply provides for record keeping of procedures that
have been performed or completed.

This opinion is based on the facts presented. Different facts though similar,
may result in different answers.

If you have any questions or need more information, you may call me toll free
at 1-800-531-5441, ext. 34675. The direct line is 512/463-3465. You may also
write to Tax Policy, Comptroller of Public Accounts.

Sincerely,

Tom Soto
Tax Policy Division