Category Archives: Texas Third Court of Appeals

Third Court of Appeals Defers to Comptroller on Manufacturing Exemption for Oil & Gas

As we reported earlier, the Third Court of Appeals ruled in Southwest Royalties, Inc. v. Combs that oil and gas above-ground and downhole production equipment doesn’t qualify for the Texas sales tax manufacturing exemption.  This case has drawn a fair amount of attention due to the large potential financial impact on the State of Texas […]


Texas Supreme Court Won’t Weigh in on Prepayment Requirement for Court Access

Today, the Texas Supreme Court denied the Texas Comptroller’s Petition for Review in the Richmont Aviation case.  As a result, the Third Court of Appeals’ decision in the taxpayer’s favor becomes final, but the Texas Supreme Court has taken no position on the Third Court of Appeals’ holding in Richmont Aviation, leaving some uncertainty in […]


Court of Appeals Denies Texas Sales Tax Exemption for Oil and Gas Equipment

The Texas Third Court of Appeals just issued its opinion in Southwest Royalties, Inc. v. Combs, No. 03-12-00511-CV.  The opinion affirms a district court opinion denying oil and gas operators the Texas sales tax manufacturing exemption on their purchases of certain above-ground and downhole production equipment.  The opinion also provides some useful discussion of the circumstances […]


Michigan Supreme Court OKs Three-Factor Apportionment, Possible Texas Franchise Tax Implications

In its recent decision in IBM Corp. v. Department of Treasury, the Michigan Supreme Court ruled that taxpayers may apportion their tax base for the Michigan Business Tax using the three-factor apportionment method provided by the Multistate Tax Compact instead of the single-factor apportionment method the Michigan Business Tax statute provided.  The decision means that […]


Texas Comptroller appeals taxpayer’s margin tax win in Titan Transportation

The Texas Comptroller filed a petition for review with the Texas Supreme Court, asking it to overturn the Third Court of Appeals’ decision in the taxpayer’s favor in Titan Transportation, L.P. v. Combs. That decision rejects the Texas Comptroller’s narrow, restrictive interpretation of the revenue exclusion for certain payments to those who perform work on […]


Taxpayers’ first appellate margin tax win becomes final

The Third Court of Appeals’ decision in Combs v. Newpark Resources, Inc. became final today, marking Texas taxpayers’ first appellate margin tax win.  The Texas Comptroller did not file a timely appeal with the Texas Supreme Court, so the Third Court of Appeals issued its mandate today.  The opinion, originally handed down this past December, […]


Another Taxpayer Win in Texas Margin Tax Case

The Third Court of Appeals’ recent opinion in Titan Transportation v. Combs is another big win for taxpayers under the revised Texas franchise tax (also known as the Texas margin tax).  In opinion, the Third Court of Appeals rejected the Texas Comptroller’s narrow, restrictive interpretation of the revenue exclusion for certain payments to those who […]


Third Court of Appeals Expands Aircraft Sales Tax Exemption

The Third Court of Appeals’ opinion in Cirrus Exploration Company v. Combs expands the number of businesses who may purchase aircraft without paying Texas sales and use tax.  In doing so, the Third Court of Appeals once again rejected a long-standing Texas Comptroller policy that imposed additional requirements not found in the Texas Tax Code […]


Third Court of Appeals First Texas Margin Tax Opinion is a Big Win for Taxpayers

The Third Court of Appeals issued its opinion today in Combs v. Newpark Resources, Inc., its first case under the revised Texas franchise tax law (also known as the Texas margin tax).   The opinion rejects the Texas Comptroller’s narrow interpretation of the Texas franchise tax’s cost of goods sold deduction in favor of the taxpayer’s […]


Court of Appeals Hears Argument Regarding Texas Sales Tax Exemption for Oil and Gas Equipment

The Texas Third Court of Appeals heard oral argument today in Southwest Royalties, Inc. v. Combs, No. 03-12-00511-CV.  The case addresses whether oil and gas operators may claim the Texas sales and use tax manufacturing exemption on their purchases of certain above-ground and downhole production equipment.  An ultimate win for the taxpayer here could mean […]


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