Sales Tax on Telecommunication Services Exemptions

Telecommunications services between locations in Texas are subject to state and local sales tax, whereas most interstate telecommunications services are only subject to state sales tax. Mobile telecommunications services are subject to state and local sales tax based on the place of primary use.

“Telecommunications services” is broadly defined as electronic transmission or reception of sounds, data, and information and is not limited to current technology. The definition includes newer methods of sending and receiving signals that may be introduced in the future.

Telecommunications services that are subject to both state and local sales tax include such things as:

  • basic local exchange service
  • installation and service connection fees
  • intrastate long-distance telephone calls
  • call waiting
  • call forwarding
  • paging
  • intrastate coin-operated telephones
  • mobile telephone service
  • facsimile (FAX) service
  • mobile radio service
  • equipment rented or leased to the customer in connection with a telecommunications service

For additional information, visit TX Comptroller

About Davis Davis & Harmon LLC – Sales Tax Experts: Headquartered in Dallas, Texas, Davis Davis & Harmon LLC – Sales Tax Experts specializes in sales/use tax refund recovery and audit defense. Our team of consultants is comprised of former Big 4 sales tax consultants and state sales tax auditors. Each of our consultants has 15 to 20 years of experience, providing our clients with access to a highly specialized team of sales/use tax professionals. At Davis Davis & Harmon, LLC we are committed to maintaining the highest standards in our talent pool. We work hard to meet our clients’ needs by ensuring that you view our firm as an extension of your company and a member of your team.

For sales/use tax compliance questions or audit-related concerns, we are here to help!

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