Texas Comptroller Finds Restaurant’s Smallware, Dual-Purpose Items Purchases Not Exempt From Sales Tax

The Texas Comptroller of Public Accounts Aug. 1 decided to adopt the Administrative Law Judge’s (ALJ) recommendation that Tax Division’s (Staff) sales and use tax audit be amended only as agreed by the Staff. Taxpayer operated a chain of restaurants in the state. The Staff audited and assessed Taxpayer’s liability. Taxpayer requested redetermination, contending that it erroneously paid tax on the purchases of smallware and on exempt dish soap, hand soap, and paper towels (dual-purpose items). The Staff issued an amended assessment. The ALJ found that: 1) the smallware purchases weren’t eligible for the resale exemption as they weren’t purchased ...