Tax Law

Texas Court of Appeals holds Hotel Consumables not Purchased for Resale

The Texas Court of Appeals held that a hotel owner was not entitled to a resale exemption for the hotel consumables it offered to its guests during their stay. Alamo National Building Management (“Alamo”) purchased items such as soap, lotion, cups and coffee, among other things, using a resale certificate. The items were not separately invoiced to customers and the hotel’s website indicated that the items were “free” and included in the hotel rate. In addition, guests paid a single rental price and were not informed they were paying for the consumables even though Alamo asserted that 35% of the room rental price was for these consumables. Based on the lack of a separate charge, the description on the website and other evidence presented at trial, the Court of Appeals found that the trial court had sufficient grounds to conclude that Alamo did not purchase the items for resale and upheld the assessment.


Alamo Nat’l Bldg. Mgmt. LP v. Hegar, 13-17-00040-CV (Tx. Ct. App. 2019)