The sale and use of certain property and services in the state of Texas is subject to a tax of up to 8.25 percent. Sellers are required to collect the tax from their customers and pay it to the Texas Comptroller. However, the tax is ultimately a debt of the purchaser, and the Texas Comptroller can go after both the seller and purchaser to recover the tax.
It can be difficult to determine what is covered by sales and use tax. What constitutes a sale, use, property, and services subject to the tax are defined over the course of the Texas Tax Code, the Texas Administrative Code, and various other administrative materials. In addition, numerous exemptions and credits may apply.
Beyond the tax itself, sellers may be required to obtain sales and use tax permits for each location where they do business. Sellers also may be required to file sales and use tax reports with the Texas Comptroller, usually on a monthly basis. Failure to collect or remit the tax, obtain sales and use tax permits, or file sales and use tax reports can lead to various civil and criminal penalties.
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