Our law firm set Pointsmith Point-of-Purchase Management Services, LP v. Combs (Cause No. D-1-GN-11-001514) for trial the week of December 4, 2017. Pointsmith prints promotional items (such as gas station pump signs advertising a new promotion) and provides fulfillment services where Pointsmith charges customers to store, box, and ship Pointsmith-printed items or items provided by third parties. The Comptroller audited Pointsmith and imposed Texas sales tax on Pointsmith’s fulfillment service on the basis that it is a continuation of a preceding taxable sale of printed materials and, thus, subject to tax under the sales price rule. Pointsmith rejects this contention, instead stating that the fulfillment services are not a continuation of a print sale because title, possession, and ownership of printed items transfer to its customer once the items are printed. Moreover, Pointsmith’s print and fulfillment activities are independently desired by and provided to customers, and are therefore non-taxable under Rylander v. San Antonio SMSA Limited Partnership.

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