The below excerpt is from Maria Koklanaris’s article “Texas Decision Stymies Tax Agency Attempt At Policy Change” published by Law 360 on March 30th, 2022. Read the full article on Law360 here (subscription required).
The Texas Supreme Court recently reversed a lower appellate court’s ruling and rejected the state comptroller’s reading of the tax code – backing Sirius XM Radio in its effort to obtain a $2.5 million franchise tax refund. The justices confirmed that Texas law requires a system of origin sourcing with the receipts sourced to where the service was performed.
Noting that the lower appellate court had ruled in favor of the comptroller, Jordan M. Goodman said he thought the court had stretched to agree that the service was performed at the car's antennae as the signal was converted.
“The Texas Supreme Court, in overturning the lower court, simply conducted a plain reading of the statute as it was drafted,” said Jordan.