Texas Tax Code

§ 151.318 — PROPERTY USED IN MANUFACTURING

TX § 151.318Title 2. STATE TAXATION · Part E. SALES, EXCISE, AND USE TAXES · Ch. 151. LIMITED SALES, EXCISE, AND USE TAX · Art. H. EXEMPTIONS

Statute text

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(a)The following items are exempted from the taxes imposed by this chapter if sold, leased, or rented to, or stored, used, or consumed by a manufacturer:

(1)tangible personal property that will become an ingredient or component part of tangible personal property manufactured, processed, or fabricated for ultimate sale;

(2)tangible personal property directly used or consumed in or during the actual manufacturing, processing, or fabrication of tangible personal property for ultimate sale if the use or consumption of the property is necessary or essential to the manufacturing, processing, or fabrication operation and directly makes or causes a chemical or physical change to:

(A)the product being manufactured, processed, or fabricated for ultimate sale; or

(B)any intermediate or preliminary product that will become an ingredient or component part of the product being manufactured, processed, or fabricated for ultimate sale;

(3)services performed directly on the product being manufactured prior to its distribution for sale and for the purpose of making the product more marketable;

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Legislative history

Acts 2007, 80th Leg., R.S., Ch. 1266 (H.B. 3319), Sec. 6(a), eff. July 1, 2007.