Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2015
Sales and Use Tax Annotations
340.0000 MAILING LISTS AND SERVICES—Regulation 1504
340.0129 Number of Uses. As part of the operation of a consulting business, lists of certain names associated with the investment community are provided to the business' clients. The lists are provided to clients in three formats: pressure sensitive labels, cheshire labels, and magnetic tape. The lists are updated periodically and should a client request a list every two months, each list would contain some different names and addresses. A typical agreement entitles the customer to up to six updated, individualized, and custom designed sets of labels during any contract year. The above typical agreement does not restrict the use of the lists to one use. Rather, the client is entitled to six sets of labels during each contract year. There is nothing in the contract which would restrict a client from receiving the six sets of labels at one time. While this clearly would not be practical, it would be possible. Regulation 1504(a)(3) provides that tax will not apply if the contract restricts the transferee to a one time use of the mailing list. Since the contract does not restrict it to a one time use, the agreement is subject to tax. The fact that some of the names may be deleted and others added will not affect this conclusion since the contract clearly does not restrict the use of the mailing list to only one time. 12/16/80.