2023 Texas Statutes › Tax Code › Title 2 - State Taxation › Subtitle E - Sales, Excise, and Use Taxes › Chapter 151 - Limited Sales, Excise, and Use Tax › Subchapter H. Exemptions › Section 151.316. Agricultural Items

Sec. 151.316.  AGRICULTURAL ITEMS.  (a)  Subject to Section 151.1551, the following items are exempted from the taxes imposed by this chapter:
(1)  horses, mules, and work animals;
(2)  animal life the products of which ordinarily constitute food for human consumption;
(3)  feed for farm and ranch animals;
(4)  feed for animals that are held for sale in the regular course of business;
(5)  seeds and annual plants the products of which:
(A)  ordinarily constitute food for human consumption;
(B)  are to be sold in the regular course of business; or
(C)  are used to produce feed for animals exempted by this section;
(6)  fertilizers, fungicides, insecticides, herbicides, defoliants, and desiccants exclusively used or employed on a farm or ranch in the production of:
(A)  food for human consumption;
(B)  feed for animal life; or
(C)  other agricultural products to be sold in the regular course of business;
(7)  machinery and equipment exclusively used or employed on a farm or ranch in the building or maintaining of roads or water facilities or in the production of:
(A)  food for human consumption;
(B)  grass;
(C)  feed for animal life; or
(D)  other agricultural products to be sold in the regular course of business;
(8)  machinery and equipment exclusively used in, and pollution control equipment required as a result of, the processing, packing, or marketing of agricultural products by an original producer at a location operated by the original producer for processing, packing, or marketing the producer's own products if:
(A)  50 percent or more of the products processed, packed, or marketed at or from the location are produced by the original producer and not purchased or acquired from others; and
(B)  the producer does not process, pack, or market for consideration any agricultural products that belong to other persons in an amount greater than five percent of the total agricultural products processed, packed, or marketed by the producer;
(9)  ice exclusively used by commercial fishing boats in the storing of aquatic species including but not limited to shrimp, other crustaceans, finfish, mollusks, and other similar creatures;
(10)  tangible personal property, including a tire, sold or used to be installed as a component part of a motor vehicle, machinery, or other equipment exclusively used or employed on a farm or ranch in the building or maintaining of roads or water facilities or in the production of:
(A)  food for human consumption;
(B)  grass;
(C)  feed for animal life; or
(D)  other agricultural products to be sold in the regular course of business;
(11)  machinery and equipment exclusively used in an agricultural aircraft operation, as defined by 14 C.F.R. Section 137.3;
(12)  tangible personal property incorporated into a structure that is used for the disposal of poultry carcasses in accordance with Section 26.303, Water Code;
(13)  tangible personal property incorporated into or attached to a structure that is located on a commercial dairy farm, is used or employed exclusively for the production of milk, and is:
(A)  a free-stall dairy barn; or
(B)  a dairy structure used solely for maternity purposes; and
(14)  telecommunications services exclusively provided or used for the navigation of machinery and equipment exclusively used or employed on a farm or ranch in the building or maintaining of roads or water facilities or in the production of:
(A)  food for human consumption;
(B)  grass;
(C)  feed for animal life; or
(D)  other agricultural products to be sold in the regular course of business.
(b)  Subject to Section 151.1551, tangible personal property sold or used to be installed as a component of an underground irrigation system is exempt from the taxes imposed by this chapter if the system is exclusively used or employed on a farm or ranch in the production of:
(1)  food for human consumption;
(2)  grass;
(3)  feed or forage for:
(A)  animal life the products of which ordinarily constitute food for human consumption; or
(B)  horses, mules, and work animals; or
(4)  other agricultural products to be sold in the regular course of business.
(c)  In this section:
(1)  "Farm or ranch" includes one or more tracts of land used, in whole or in part, in the production of crops, livestock, or other agricultural products held for sale in the regular course of business.  The term includes feedlots, dairy farms, poultry farms, commercial orchards, commercial nurseries, and similar commercial agricultural operations.  The term does not include a home garden or a timber operation.
(2)  "Original producer" means a person who:
(A)  brings an agricultural product into being and is the owner of the agricultural product from the time it is brought into being until it is processed, packed, or marketed;  or
(B)  is the grower of an agricultural product, exercises predominant operational control over the raising of the agricultural product, and bears a risk of loss of investment in the agricultural product.
(d)  Two or more corporations that operate agricultural activities on the same tract or adjacent tracts of land and that are entirely owned by an individual or a combination of the individual, the individual's spouse, and the individual's children may qualify as an original producer for the purposes of Subsection (a)(8).
Acts 1981, 67th Leg., p. 1563, ch. 389, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1984, 68th Leg., 2nd C.S., ch. 31, art. 9, Sec. 1, eff. Oct. 1, 1984;  Acts 1987, 70th Leg., 2nd C.S., ch. 5, art. 1, pt. 4, Sec. 24;  Acts 1993, 73rd Leg., ch. 486, Sec. 1.07, eff. Sept. 1, 1993;  Acts 1995, 74th Leg., ch. 1000, Sec. 14, eff. Oct. 1, 1995.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1162 (H.B. 3144), Sec. 1, eff. September 1, 2009.
Acts 2009, 81st Leg., R.S., Ch. 1373 (S.B. 958), Sec. 1, eff. September 1, 2009.
Acts 2011, 82nd Leg., R.S., Ch. 91 (S.B. 1303), Sec. 23.003, eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 225 (H.B. 268), Sec. 3, eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 225 (H.B. 268), Sec. 4, eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 1030 (H.B. 2810), Sec. 1, eff. September 1, 2011.
Acts 2015, 84th Leg., R.S., Ch. 236 (S.B. 140), Sec. 2, eff. September 1, 2015.