We sell newspapers and other periodicals in a local cigar shop in Houston, Texas. Should we be collecting sales tax on the sale of newspapers?

Newspapers are not subject to sales tax in the state of Texas. This is the case whether the newspapers are sold or distributed by individual copy or subscription plan. Magazines are also generally exempt from sales tax in Texas. There are some exceptions though such as if the magazine is fully supported by advertisers. In that case, the advertisers must remit sales tax.