Part 1.
COMPTROLLER OF PUBLIC ACCOUNTS
Chapter 3.
TAX ADMINISTRATION
Subchapter K. HOTEL OCCUPANCY TAX
34 TAC §3.161
The Comptroller of Public Accounts adopts an amendment to §3.161,
concerning definitions, exemptions, and exemption certificate, with changes
to the proposed text as published in the September 27, 2002, issue of the
This amendment incorporates legislative changes in House Bill 2812, 77th
Legislature, 2001, which amended Tax Code, Chapter 156, to remove the requirement
that public and private institutions of higher education be Texas public and
private institutions of higher education to be exempt from state hotel occupancy
tax. Subsections (a)(4) and (b)(6) are added to clarify the permanent resident
exemption. Subsection (a)(5) is added to define a private club. Subsection
(d)(1) is added to clarify that dormitories and other housing facilities operated
by institutions of higher education are excluded from the definition of a
hotel. Subsection (d)(2) is added to clarify that hotel tax is not due on
room rentals to members by a private club, which eliminates the need for subsection
(b)(1). Subsection (b) is amended to delete the language concerning private
clubs from the exemption section and add requirements to obtain a permanent
resident exemption. Other subsections of the proposed rule are amended for
clarity.
No comments were received regarding adoption of the amendment.
This amendment is adopted under Tax Code, §111.102, which
provides the comptroller with the authority to prescribe, adopt, and enforce
rules relating to the administration and enforcement of the provisions of
Tax Code, Title 2.
The amendment implements Tax Code, §156.101 and §156.102(b).
§3.161.Definitions, Exemptions, and Exemption Certificate.
(a)
Definitions. The following words and terms, when used in
this subchapter, shall have the following meanings, unless the context clearly
indicates otherwise.
(1)
Charitable or eleemosynary organization--A nonprofit organization
devoting all or substantially all of its activities to the alleviation of
poverty, disease, pain, and suffering by providing food, clothing, drugs,
treatment, shelter, or psychological counseling directly to indigent or similarly
deserving members of society with its funds derived primarily from sources
other than fees or charges for its services. If the organization engages in
any substantial activity other than the activities described in this section,
it will not be considered as having been organized for purely public charity,
and therefore, will not qualify for exemption under this provision. No part
of the net earnings of the organization may inure to the benefit of any private
party or individual other than as reasonable compensation for services rendered
to the organization. Some examples of organizations that do not meet the requirements
for exemption under this definition are fraternal organizations, lodges, fraternities,
sororities, service clubs, veterans groups, mutual benefit or social groups,
professional groups, trade or business groups, trade associations, medical
associations, chamber of commerce, and similar organizations. Even though
not organized for profit and performing services that are often charitable
in nature, these types of organizations do not meet the requirements for exemption
under this provision.
(2)
Educational organization--A nonprofit organization or governmental
entity whose activities are devoted solely to systematic instruction, particularly
in the commonly accepted arts, sciences, and vocations, and has a regularly
scheduled curriculum, using the commonly accepted methods of teaching, a faculty
of qualified instructors, and an enrolled student body or students in attendance
at a place where the educational activities are regularly conducted. An organization
that has activities consisting solely of presenting discussion groups, forums,
panels, lectures, or other similar programs, may qualify for exemption under
this provision, if the presentations provide instruction in the commonly accepted
arts, sciences, and vocations. The organization will not be considered for
exemption under this provision if the systematic instruction or educational
classes are incidental to some other facet of the organization's activities.
No part of the net earnings of the organization may inure to the benefit of
any private party or individual other than as reasonable compensation for
services rendered to the organization. Some examples of organizations that
do not meet the requirements for exemption under this definition are professional
associations, business leagues, information resource groups, research organizations,
support groups, home schools, and organizations that merely disseminate information
by distributing printed publications. Entities that are defined in the Education
Code, §61.003, as "institutions of higher education" are recognized for
exemption under this provision. Included in the definition of "institutions
of higher education" are state and private universities and colleges.
(3)
Hotel--Any building or buildings in which members of the
public obtain sleeping accommodations for a consideration. The term includes,
in addition to the buildings listed in Tax Code, §156.001, manufactured
homes, skid mounted bunk houses, residency inns, condominiums, cabins, and
cottages.
(4)
Permanent Resident--A person who has the right to use or
occupy a room or space in a hotel for at least 30 consecutive days without
interruption. A person may be an individual, organization, or entity.
(5)
Private Club--An organization that provides members entertainment,
recreation, sport, dining, or social facilities and assesses dues, initiation
fees, and other charges for special privileges or status not available to
the general public.
(6)
Religious organization--A nonprofit organization that is
an organized group of people regularly meeting for the primary purpose of
holding, conducting and sponsoring religious worship services, according to
the rights of their sect. The organization must be able to provide evidence
of an established congregation showing that there is an organized group of
people regularly attending these services. An organization that supports and
encourages religion as an incidental part of its overall purpose, or one whose
general purpose is furthering religious work or instilling its membership
with a religious understanding, will not qualify for exemption under this
provision. No part of the net earnings of the organization may inure to the
benefit of any private party or individual other than as reasonable compensation
for services rendered to the organization. Some examples of organizations
that do not meet the requirements for exemption under this definition are
conventions or associations of churches, evangelistic associations, churches
with membership consisting of family members only, missionary organizations
and groups who meet for the purpose of holding prayer meetings, bible study
or revivals.
(b)
Exemptions. This subsection deals with exemptions from
the state hotel occupancy tax. For information on city and county hotel taxes,
contact the affected city or county.
(1)
Religious, charitable, and educational organizations and
their employees, including college and university personnel, traveling on
official business of the organization are exempt from payment of hotel occupancy
tax.
(2)
State officials, judicial officers, heads of state agencies,
the Executive Director of the Legislative Council, the Secretary of the Senate,
state legislators, legislative employees, members of state boards and commissions,
and designated state employees of the State of Texas who present a Hotel Tax
Exemption Photo Identification Card when traveling on official state business
are exempt from the hotel occupancy tax. State agency, institution, board,
or commission employees who have not been issued a Hotel Tax Exemption Photo
Identification Card must pay the hotel occupancy tax. The hotel tax paid by
the state or reimbursed to a state employee may be refunded as provided in §3.163
of this title (relating to Refund of Hotel Occupancy Tax). For the purpose
of claiming an exemption, a Hotel Tax Exemption Photo Identification Card
includes:
(A)
any photo identification card issued by a state agency
that states "EXEMPT FROM HOTEL OCCUPANCY TAX, under Tax Code, §156.103(d)",
or similar wording; or
(B)
a Hotel Tax Exemption Card that states "when presented
with a photo identification card issued by a Texas agency, the holder of this
card is exempt from state, municipal, and county hotel occupancy tax, Tax
Code, §156.103(d)", or similar wording.
(3)
The United States government and its employees traveling
on official business representing the United States government are exempt
from the hotel occupancy tax.
(4)
Diplomatic personnel of a foreign government who present
an appropriate Tax Exemption Card issued by the United States Department of
State are exempt from the tax.
(5)
If an exemption applies, then the organization or individual
claiming exemption must present an exemption certificate to the hotel.
(6)
Permanent residents are exempt from payment of hotel occupancy
tax.
(A)
A permanent resident is exempt beginning on:
(i)
the first day for which the resident has entered into a
written agreement with the hotel or has given a written notice to the hotel
of the resident's intent to use or occupy a room or space in the hotel for
the next 30 or more consecutive days and the resident actually stays for at
least the next 30 consecutive days; or
(ii)
the first day after the 30th consecutive day of the stay,
if the resident neither gave written notice of intent to stay, nor entered
into any written agreement with the hotel. For example, if a person does not
notify the hotel that he intends to stay for at least 30 days, but stays 35
days, then the person is exempt from hotel tax from the 31st day through the
35th day, but tax is due on the first 30 consecutive days of the occupancy.
(B)
The permanent resident exemption ends when an interruption
in the right to use or occupy the room or space occurs.
(C)
Permanent residents are not required to physically occupy
a room or space.
(D)
Permanent residents may have the right to use or occupy
different rooms in the same hotel without loss of the permanent resident exemption.
(E)
The permanent resident exemption applies to the lowest
number of rooms in a written notice, agreement, or contract for a range of
rooms plus the number of rooms that qualify for the permanent resident exemption
under subsection (b)(6)(A)(ii) of this section.
Figure: 34 TAC §3.161(b)(6)(E)
(c)
Exemption certificate.
(1)
Any organization or individual claiming exemption from
the payment of hotel occupancy tax must furnish the hotel with a signed exemption
certificate.
(2)
A hotel claiming exemption of its receipts from hotel occupancy
tax must provide proof that the receipts were exempt, either through exemption
certificates or other competent evidence.
(3)
Exemption numbers or tax numbers do not exist for purposes
of the hotel occupancy tax.
(4)
The exemption certificate must be substantially in the
form herein adopted by reference. Copies of the certificate are available
for inspection at the office of the Texas Register or may be obtained from
the Comptroller of Public Accounts, P.O. Box 13528, Austin, Texas 78711. Copies
may also be requested by calling our toll-free number 1-800-252-1385. In Austin,
call 463-4600. (From a Telecommunication Device for the Deaf (TDD) only, call
1-800-248-4099 toll free. In Austin the local TDD number is 463-4621.) Taxpayers
may download copies at www.window.state.tx.us.
(d)
Exclusions.
(1)
Dormitories and other housing facilities owned or leased
and operated by institutions of higher education as defined in subsection
(a)(2) and used to provide sleeping accommodations for persons engaged in
educational programs or activities at the institutions are excluded from the
definition of a hotel in Tax Code, §156.001, and their rentals are not
subject to tax. Hotels owned or leased and operated by institutions of higher
education, however, are not excluded and their rentals are subject to tax.
(2)
Private clubs as defined in subsection (a)(5) do not collect
tax on rentals of rooms to members. Tax is due, however, on the rental of
rooms to nonmembers.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed with the Office of
the Secretary of State on December 18, 2002.
TRD-200208396
Martin Cherry
Deputy General Counsel for Taxation
Comptroller of Public Accounts
Effective date: January 7, 2003
Proposal publication date: September 27, 2002
For further information, please call: (512) 475-0387
Chapter 301.
RULES OF THE TEXAS STATEWIDE EMERGENCY SERVICES RETIREMENT FUND
Part 11.
OFFICE OF THE FIRE FIGHTERS' PENSION COMMISSIONER