Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 295.1630


295.1630 Photography Franchise Fee. A company is a franchisor of its photographic and sales techniques, methods, and procedures. Under the franchise agreement it agrees to furnish ". . . all film, paper forms, order books, mounts, prints, processing service and delivery service necessary to carry out the business of (the franchisee) a photography studio." The company receives a percentage of the franchisee's gross sales for these services, supplies and counsel.

The film and processing services furnished to franchisees are "sold" within the concept of that term as used in the Sales and Use Tax Law. The fact that the price of the items sold is determined by a percentage of the franchisees' gross receipts is immaterial. Tax does not apply to those items shipped in interstate commerce pursuant to the contract of sale or sold for resale. 7/31/73.