Additional services are deemed part of lease agreement and subject to tax in Texas.

In a hearing, an administrative law judge has determined that consulting services and maintenance agreements that are billed under a lease agreement are taxable. Under Texas Tax Code Section 151.007, the total amount paid for a taxable item includes a service that is part of the transaction. The charges in question were separately stated from the lease payment; however, they were included on the same invoice. The lessee presented the position that the charges were not taxable since the lessor did not provide the services. (Hearing No. 35, 771, December 22, 1997)