- Texas Supreme Court denied GEO Group’s claim for a sales tax exemption on $4 million in purchases.
- GEO purchased essentials for correctional facilities without paying sales tax between 2011 and 2014.
- GEO argued for exemption as a government agent or instrumentality.
- Court ruled GEO is a for-profit corporation, not government owned or controlled.
- Contracts labeled GEO as an independent contractor responsible for its own taxes.
- GEO did not meet criteria for unincorporated government instrumentalities.
- Court clarified refund claims should follow the preponderance of the evidence standard.
- Court ruled GEO is ineligible for the tax refund and state retains paid taxes.
- Ruling indicates performing government work does not make a private business tax-exempt.
- Entities contracted for public services should assess legal structure and contractual terms for exemption eligibility.
Source: salestaxinstitute.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
