Is a commercial dog breeder engaged in farming? Snoopy was born at the Daisy Hill Puppy Farm, which sounds like a farm. On the other hand, in upper New York State, the Monks of New Skete breed German Shepherd dogs at their monastery.
The classification of commercial dog breeders may not matter to the folks purchasing dogs, but it has real fiscal consequences for the dog breeders of New York State. The NY Department of Taxation and Finance recently released an advisory opinion on the subject, in response to a petitioner wishing to know if the dog food fed to his breeding dogs qualified for an exemption from sales tax.
The department reminds that under New York Tax Law Section 1105-B, certain food and drinks are exempt from sales tax. These include food and drink sold to students at restaurants and cafeterias located in schools, and food and drink sold to airlines for consumption during flights. Furthermore, under New York Tax Law Section 1115(a)(6)(A), “Tangible personal property… for use or consumption predominantly either in the production for sale of tangible personal property by farming or in a commercial horse boarding operation, or in both…” is also exempt from sales tax.
However, the department determined that “the breeding or raising of animals is not encompassed” in the “types of production activities that qualify for the exemption.”
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