Response
July 9, 1993
Request
May
4, 1993
XXXXX
The
Utah State Tax Commission
160
East Third South
Salt
Lake City UT 84134-0410
RE:
Sales Tax Applicability of Advertising Print
Dear
XXXXX:
Per
your request, I am writing to you so that I can have a formal statement by the Utah
State Tax Commission addressing the applicability of sales tax to printed
advertising material. I have contacted the Tax Commission three times to
clarify whether printed advertising material is taxable in the following three
instances:
(A) Printed advertising inserts are inserted
into newspapers
(B) Printed advertising inserts are sent to
consumers home via a mailing house
(C) Printed advertising inserts are given to
consumers upon their visit to one of our business locations
I
have received three different answers on three different occasions and now
desire that the Tax Commission will take this opportunity to clarify this
matter.
Please
include with your answer any and all relevant supporting documentation.
Please
do not hesitate to call me if you have any questions. My phone number is
(XXXXX.)
Sincerely,
XXXXX
July
9, 1993
XXXXX
Re:
Advisory Opinion - Sales or Use Tax Applicability to Printed Advertising
Inserts.
Dear
XXXXX:
Your
request (copy attached) for an advisory opinion as to how sales tax applies to
the sale or purchase of advertising inserts under various methods of delivery
was referred to the Auditing Division for their analysis.
The
division's staff recommendations are as follows:
A. If advertising inserts are inserted in
newspapers for delivery as part of the newspaper, the purchase of such inserts
is exempt from the tax if the conditions of Administrative Rule R865-19S-65 are
met.
B. If advertising inserts are sent to a
prospective customer's home by a mailing service, the printer, XXXXX; the
purchaser of the inserts is considered to be the consumer of the inserts. If
XXXXX takes delivery of the inserts in Utah (either itself or through its agent
mailing house), the purchase of the inserts is subject to the tax, regardless
of to where they are mailed. If XXXXX (or its agent) takes delivery outside of
Utah, only those inserts that are sent to Utah prospective customers are
subject to the tax. If the state in which XXXXX initially takes delivery
imposes a sales tax on such inserts, Utah will allow credit (up to the Utah
rate) for the tax first properly due and paid to that state.
C. The purchase of printed advertising inserts
which are given to prospective customers at your business locations are subject
to the tax if XXXXX (or its agent) takes delivery in Utah or if the inserts are
given to customers at your Utah locations. Again, if another state properly
first imposes a tax on the purchases, Utah will allow credit.
Based
upon the facts presented in your letter, we are in agreement with the Auditing
Division recommendations. Obviously, if there deviations from these facts, this
opinion may be negated.
If
you do not agree with the determination, you may appeal to the Tax Commission
for a formal hearing. The results of that hearing would constitute a
declaratory judgment and be appealable to the Utah Supreme Court. A Notice of
Appeal Rights and a copy of the Utah Taxpayer Bill of Rights are attached.
For
the Commission,
Joe
B. Pacheco
Commission