Texas Issues Notable Ruling On Tax Of Digital Services

The Texas Comptroller of Public Accounts recently issued a decision regarding the taxability of digitized services provided by a Taxpayer to oil and gas industry customers. The Taxpayer's digitized service involves analysis of gas well log data received and the tailoring of that data in reports to the client to its specific needs.  For example, the Taxpayer might take gas well data and analyze it against certain production goals as set by the client.  The digital component of the service would therefore be taking the raw well data and measuring it against certain output or production goals as set by the client to determine an overall productivity result.  That analysis and the results would be provided to the client as its final product.