Use of Debit Cards

Received from: Kevin Koller, Assistant Director of Tax Administration

Texas Comptrollers Office

I cut the following out of STAR document 200409795L

 
A machine that is operated by an electronic card, such as a credit or  debit card and other types of electronic cards, and 
that has installed in its memory any amusement game made available for play is a coin-operated amusement machine, as defined in Occupations Code, Section 2153.002.  A general business license or registration certificate is required to own and operate the machine.  An annual occupation tax permit (decal) must also be attached.
 
A coin-operated machine is a machine or device operated by or with a coin, currency, metal slug, token, electronic card, or check.
 
The specific statutory reference is 151.335
 

§ 151.335.  COIN-OPERATED SERVICES.  (a)  Amusement and

personal services provided through coin-operated machines that are

operated by the consumer are exempt from the taxes imposed by this

chapter.

        (b)  This section does not apply to the sale of tangible

personal property or to the purchase of an admission through the use

of a coin-operated machine.

So in short – a debit card can be used on a video game and it is a tax free transaction.  The same debit card used to get access to the lane is a taxable amusement service.