Texas Supreme Court Affirms Ruling on Franchise Tax Apportionment

The Texas Supreme Court affirmed the lower courts’ rulings, upholding the Comptroller’s administrative rules on franchise tax apportionment. The dispute centered on whether sales of tangible personal property should be attributed to the location where the buyer takes delivery or to the location where the goods are ultimately used or consumed. The court concluded that section 171.103(a)(1) of the Texas Tax Code unambiguously sources receipts from sales to Texas if the taxpayer transfers possession and control of goods to a buyer at a location in the state, regardless of where the buyer subsequently transports or uses the goods. The court ...