Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2014
Sales and Use Tax Annotations
420.0000 PHOTOGRAPHERS, PHOTOSTAT PRODUCERS, PHOTO FINISHERS AND X-RAY LABORATORIES—Regulation 1528
(a) IN GENERAL
420.0173 Photographs. A photographer provides a newspaper or magazine publisher with photographs that are reproduced in the relevant publication which is subject to sales tax when sold.
Since the publisher uses the photograph in creating the publication, the sale or lease of the photograph in this state is a retail sale subject to sales or use tax. This is true even though the sale of the newspaper or periodicals by the publisher is also subject to sales tax. A photograph does not become an ingredient or component part of the publication merely because the photographic image is reproduced in the publication.
The sale of photographs to an advertising agency is also a retail sale unless the advertising agency is purchasing the photographs for resale to its customer prior to use. In that case, a resale certificate is required stating that the specific property is being purchased for resale in the regular course of business.
The photographer may purchase for resale slide transparency film that is processed into slide photographs prepared as "speculative stock shots" and held solely for resale in the regular course of business provided no use is made of the film prior to resale. If the photographer uses the slides to make positives, the sale to the photographer is a retail sale because the film will be used as a manufacturing aid in producing prints.
If the photographer makes any use of property other than demonstration and display for purpose of resale, the photographer is responsible for reporting and paying use tax measured by the sale price of the property to the photographer. The destruction of the "speculative stock shots" which did not sell is not considered a taxable use. 9/21/92.