We are a tax-exempt 501C-3 university in Texas. With this status, are we exempt from paying sales tax due on meals eaten at restaurants or should tax be charged?

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According to information published by the Texas Comptroller's Office and confirmed by a state information officer, only meals purchased as part of your tax-exempt activities would qualify for sales tax exemption. For example, if you were providing meals to attendees of an official function, then you would not have to pay sales tax on that.

However, if you and your staff are simply eating at restaurants, those meals are not tax exempt. This is true even if an employee is being reimbursed for the meal while traveling. Personal meals are not exempt.

If you are making an exempt meal purchase, just being a tax-exempt entity is not enough to prove it. You must also apply for a sales tax exemption certificate from the state and present it at the time of purchase.

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