Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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S

515.0000 SERVICE ENTERPRISES GENERALLY—Regulation 1501

Annotation 515.0978

(e) MISCELLANEOUS ACTIVITIES

515.0978 Event Producer. A company produces events for its clients such as employee meetings held to introduce new products or corporate messages, or to reward employees for performance. The meetings (or shows) range in audience size from twenty-five to one-thousand attendees. The company's internal staff of producers create and produce these shows using freelance artists and other vendors. The company's involvement is total from initial concept to final execution. A typical show is set up in a hotel ballroom or other suitable location, and uses rented equipment for which the company contracts and pays for. Setups are temporary and labor contracted for by the company is used. When the show is over, the rented equipment is returned and sets are either destroyed or returned to the rental facilities. No part of the show remains or is given to the client after the performance. The company does not transfer possession of the tangible personal property to its clients either before, during, or after the event.

Since the client does not take possession of the property, the company is performing a service and is the consumer of all tangible personal property it uses to produce the events. Thus, sales or use tax applies to the sale or rental of the property to the company. 7/3/95.