A non-profit professional healthcare organization’s sales of a learning system, subscriptions to its journal, and annual membership dues were exempt from Texas sales and use tax. The taxpayer is a non-profit organization under Internal Revenue Code, Section 501(c)(3). The taxpayer states that it promotes the advancement of the science and practice of medicine. The taxpayer is accredited to provide continuing medical education (CME) for physicians. The organization’s members are physicians, residents, medical students, etc. The taxpayer sells a subscription to a scientific journal (available in print and online editions), a learning system designed to evaluate an individual’s knowledge of internal medicine (available in print and digital), and membership in its organization. In the private letter ruling, the Texas Comptroller found that the taxpayer’s subscription, learning system and membership dues are all exempt from Texas sales and use tax. Books, magazines, journals, and similar publications, either in a printed or an electronic format, are generally taxable as tangible personal property in Texas. However, periodicals and writings published and distributed by a religious, philanthropic, charitable, historical, scientific, or other similar organization not operated for profit are exempt. The journal and learning system fall under this exemption since they were published by an exempt organization. Membership in the taxpayer’s organization provides access to nontaxable information services and other nontaxable items. Therefore, sales of the membership dues are also exempt.
(Letter No. 202302009L, Texas Comptroller of Public Accounts, February 14, 2023)