NEW YORK SALES TAXES ON EDITING RELAXED;
BBS TOOK LEAD IN REVISING TAX GUIDELINES

The New York State sales tax authorities have published a revised Guide to Sales Tax for the Film Industry, confirming that TV commercial intermediate post production elements no longer need to be delivered and stored out of state (usually in Delaware or New Jersey)-to qualify for sales tax exemption. This can mean worthwhile savings in shipping and storage costs for advertisers that edit commercials in New York.

The new Guide assures that advertisers may retain or even destroy these post production elements in New York without incurring 8.375 % city and state sales taxes.

The updated sales tax Guide, recently published by the State Department of Taxation and Finance, officially sanctions new procedures for handling post production elements. The changes were requested by Bird Bonette Stauderman, which was represented by Stephen Bercovitch, tax attorney with the New York accounting firm of Amper, Politziner & Mattia. The BBS proposal questioned an implication in the Tax Department’s earlier policy that intermediate post production elements must be delivered outside New YorkState to qualify for sales tax exemption.

The new Guide offers advertisers the convenience of keeping elements with the editors in New York until they are no longer needed. They may then be erased or destroyed- without sales tax consequences.

One caution must still be strictly observed. Original film negative exposed during the shooting of the commercial must continue to be delivered to an out of state location to safely avoid New York sales tax liability.

We will be updating the production guidelines for our clients to reflect the new Guides. In the meantime, BBS consultants will be mentioning the new rules in pre-bid and pre-production meetings.

Any questions on the State’s new sales tax guidelines may be directed to Al Stauderman at 203-454-8781 or al@bbsadpro.com.