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California updates taxability of news subscriptions

  • Aug 31, 2016 | Gail Cole

 No longer how most of us get our news.

Once upon a time, news was obtained primarily from printed newspapers. From California to Maine, morning coffee was accompanied with the rustle of turning pages and inked fingers. That still happens, but an increasing number of us now turn to their computers and mobile devices to obtain our news. As a result, some sales and use tax laws governing newspaper subscriptions are outdated.

The California Board of Equalization recently approved an amendment to Regulation 1590, Newspapers and Periodicals. It clarifies how California sales and use tax applies to mixed newspaper subscriptions, those allowing access to digital content in addition to the printed word.

Beginning October 1, 2016, “it is presumed that fifty-three percent of the lump-sum charge for a mixed newspaper subscription is for the nontaxable sale of the right to access digital content.” Accordingly, 47% of the charge is considered to be a taxable sale of printed material.

Newspapers are entitled to rebut this presumption by providing “evidence demonstrating … that the digital-only subscription rate is greater than fifty-three (53) percent.” Tax rates are subject to change quarterly.

The taxation of digital goods and content is much in flux, making compliance challenging. Sales tax automation software enables businesses in all states to comply with the most up-to-date rates, rules, and regulations. Learn more.

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.