New York: Survey Says - the Sale is Taxable
- Jul 29, 2013 | Gail Cole
In the past two weeks, the New York State Department of Taxation and Finance has released several Advisory Opinions regarding the applicability of sales and use tax to various transactions. The overall trend? The sale is taxable.
Printed promotional materials
However, under certain conditions, printed promotional materials may be exempt from sales tax. These conditions are:
- "The printed promotional materials are ultimately mailed or shipped to customers or prospective customers of the purchaser of the printed promotional materials.
- The printed promotional materials are mailed or shipped by the purchaser of the materials using a common carrier, the U.S. Postal Service or a like delivery service. (This requirement is also met if the mailing or shipping is arranged by a third party [such as a printer/mailer] on behalf of the purchaser of the promotional materials.)
- There is no charge to the purchaser’s customer or prospective customer (ultimate recipient) for the promotional materials, or for mailing or shipping them.
- The purchaser of the promotional materials gives a properly completed Form ST-121.2, Certificate of Exemption for Purchases of Promotional Materials, to the seller of the promotional materials."
All of the above conditions must be met in order for the printed promotional materials to be exempt from New York sales tax.
Electricity at an electric vehicle charging station
The State of New York Commissioner of Taxation and Finance has determined that "the unit charge and any fee [charged to] customers for the sale of electricity at an electric vehicle charging station is subject to sales tax under Tax Law §1105(b)(1)(A)."
Sophisticated temporary structures
It's summer and the season of outdoor weddings and parties. That makes it the obvious time to wonder about the taxability of temporary tents.
According to the New York Commission of Taxation, charges for providing temporary structures are subject to sales tax in New York. This is because temporary structures such as awnings and glass sidewalls are considered tangible personal property, and New York Tax Law § 1105(a) "imposes sales tax on the receipts from every retail sale of tangible personal property." "Sale" is defined as "any transfer of title or possession or both, rental, lease or license to use or consumer, conditional or otherwise, in any manner or by any means whatsoever for a consideration."
That pretty much sums it up. The level of sophistication of the temporary structures does not impact its taxability.
A general contractor in New York State wondered whether or not security services required during the course of capital improvement projects were subject to sales tax. The situation is interesting. The contractor performs some work at night rather than during the day, and the contractor "is mandated by the building owner to hire the building owner's security contractor to monitor the work during these phases of construction."
Pursuant to New York Tax Law § 1105(C)(8), sales tax is imposed on the provision of "protective and detective services, including, but not limited to, all services provided by or through alarm or protective systems of every nature…." Although the contractor was hired for a capital improvement project, the purchase of the security service is "in the nature of an item of overhead," and is therefore subject to sales tax.
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