Opinion ID: 2831267
Heading Depth: 2
Heading Rank: 3

Heading: Leases of Tangible Personal Property

Text: The Comptroller further argues that the leases of tangible personal property fall outside the sale-for-resale exemption. After all, the Comptroller says, leases themselves are not tangible personal property, so sale-for-resale of a lease is not the sale-for-resale of tangible personal property. But “lease” is statutorily included in the definition of “sale.”26 Therefore, lease-for-(re)lease of tangible personal property falls within the definition of sale-for-resale of tangible personal property. That said, there is no evidence here that HCSC leased the property for the purpose of releasing it. That is, using the property for the federal government contract is not the same as formally 25 Act of May 27, 2007, 80th Leg., R.S., ch. 1266, § 2, 2007 Tex. Gen. Laws 4234, 4234 (amended 2011) (current version at T EX . T AX C O D E § 151.006(a)(1)). 26 T EX . T AX C O DE § 151.005(2). 14 re-leasing the property to the federal government. The trial court pointed out that some leased property was transferred to the new contractor after HCSC’s contract ended. But there is no finding or even allegation that HCSC’s purpose in leasing the property in the first place was to re-lease it to the federal government or another contractor. Instead, the transfer of the leased property apparently only happened because the federal contract ended, not because the original purpose of leasing the property was to re-lease it. Thus, HCSC is not due a refund on sales tax paid on the leases.