Are subscription newsletters exempt from New York sales tax as periodicals, and is a training video sold with them taxable?

Plain-English summary

R.C. Anderson Associates Inc. publishes two monthly subscription newsletters — the NIE (Newspaper in Education) Information Service and the Circulation Idea Service — sold to newspaper companies worldwide, and also sells a professionally produced training video for paper carriers. It asked three questions: can it buy the printing for resale; are the newsletters exempt as newspapers or periodicals; and is the training video taxable?

The Department answered each in turn.

• Issue 1 — buying the printing (and the video) for resale. Under the resale exclusion, 20 NYCRR 526.6(c)(1), property a business buys to resell is not taxed when purchased. So the publisher may buy the printing of its newsletters — and the training video tapes — tax-free for resale by giving its printer and tape supplier properly completed Resale Certificates (Form ST-120).
• Issue 2 — are the newsletters exempt? They do not meet the definition of a newspaper, but they do qualify as periodicals under 20 NYCRR 528.6(c): published in print at least four times a year, not constituting a book, available to the public, with continuity of title and content, and containing a variety of articles by different authors (a newsletter with a staff of writers is treated as having different authors). As periodicals, their sale is exempt under Tax Law § 1115(a)(5).
• Issue 3 — the training video. A training video is tangible personal property under § 1105(a) and does not qualify as a newspaper or periodical, so its sale is taxable. The publisher must collect and remit sales tax on all training videos delivered within New York.

What this means for you

Newsletters can qualify for New York's periodical exemption even if they aren't "newspapers." The periodical test is about frequency (at least quarterly), public availability, continuity, and a variety of articles by different authors — and a newsletter written by a staff of writers meets the "different authors" requirement. Meet the test, and subscription sales are exempt under § 1115(a)(5).

Buy your production inputs for resale. A publisher reselling exempt periodicals (and other tangible items like videos) can buy the printing and the tapes tax-free with a Resale Certificate, since those become the product it sells.

Not everything a publisher sells rides the exemption. A training video is tangible personal property, not a periodical, so its sale is taxable even though it's sold alongside exempt newsletters. Separate the tax treatment of each product.

Common questions

Q: My subscription newsletter isn't a newspaper. Can it still be exempt?
A: Yes, if it qualifies as a periodical — published at least four times a year, available to the public, with continuity of title/content and a variety of articles by different authors. A staff of writers counts as different authors.

Q: Can I buy the printing for my newsletter without tax?
A: Yes. Because you resell the printed newsletters, you can buy the printing for resale with a Resale Certificate (Form ST-120). The same applies to video tapes you resell.

Q: Is the training video I sell exempt too?
A: No. A video is tangible personal property, not a periodical, so its sale is taxable, and you must collect tax on videos delivered in New York.

Citations and references

Statute and regulation:

• Tax Law § 1105(a) — taxes receipts from retail sales of tangible personal property (the training video)
• Tax Law § 1115(a)(5) — exempts newspapers and periodicals
• 20 NYCRR 528.6 — defines newspaper and periodical; a newsletter can be a periodical, and a staff of writers satisfies the "different authors" requirement
• 20 NYCRR 526.6(c)(1) — resale exclusion: property bought for resale is not taxed on purchase (Form ST-120)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1987.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a87_43s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-87(43)S
Sales Tax
November 12, 1987

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S870220A

On February 20, 1987, a Petition for Advisory Opinion was received from R.C. Anderson
Associates Inc., P.O. Drawer 160, Pittsford, New York 14534.
The issues raised are (1) whether Petitioner may purchase the printing of its publications for
resale, (2) whether the subsequent sale by Petitioner of its publications is the sale of a newspaper or
periodical which is exempt from sales tax under § 1115(a)(5) of the Tax Law and (3) whether the
sale of a training video is subject to tax.
Petitioner publishes two monthly newsletters which have world-wide paid circulation to
newspaper companies. One is the NIE (Newspaper in Education) Information Service with 300
subscribers; the other is the Circulation Idea Service with 725 subscribers. There are forty
subscribers within New York State. The training video here at issue is a professionally produced
video tape used to train paper carriers.
The NIE Information Service consists of approximately 8 pages devoted to showing
newspaper publishers how to use their newspapers in local schools as an educational tool. The
publications submitted contain news and articles of interest to newspaper carrier route managers.
The Circulation Idea Service is directed towards supplying newspaper publishers with ideas
on how to recruit and retain newspaper carriers. The publication contains suggestions for contests
as well as ideas which were successfully tried by some of its newspaper-subscribers.
Both the NIE Information Service and the Circulation Idea Service contain a minimal amount
of camera ready artwork.
Section 1105(a) of the Tax Law imposes a tax upon "[t]he receipts from every retail sale of
tangible personal property, except as otherwise provided in this article." However, section
1115(a)(5) of the Tax Law exempts newspapers and periodicals from the tax imposed under section
1105(a).
Section 528.6 of the sales tax regulations defines both newspapers and periodicals.
528.6 Newspapers and periodicals (Tax Law, § 1115[a][5]). (a) Exemption.
The sale of newspapers and periodicals is exempt from sales and compensating use tax.
(b)
Definition of newspaper. (1) In order to constitute a newspaper, a publication must
conform generally to the following requirements:
(i) it must be published in printed or written form at stated short intervals, usually
daily or weekly;
RODERICK G. W. CHU, COMMISSIONER
TP-8 (3/83)

GABRIEL B. DiCERBO, DEPUTY COMMISSIONER
FRANK J. PUCCIA, DIRECTOR

-2­
TSB-A-87(43)S
Sales Tax
November 12, 1987
(ii) it must not, either singly or, when successive issues are put together, constitute
a book;
(iii) it must be available for circulation to the public; and
(iv) it must contain matters of general interest and reports of current events.
(c)
Definition of a periodical. (1) In order to constitute a periodical, a publication must
conform generally to the following requirements:
(i) it must be published in printed or written form at stated intervals, at least as
frequently as four times a year;
(ii) it must not, either singly or, when successive issues are put together, constitute
a book;
(iii) it must be available for circulation to the public;
(iv) it must have continuity as to title and general nature of content from issue to
issue; and
(v) each issue must contain a variety of articles by different authors devoted to
literature, the sciences or the arts, news, some special industry, profession, sport or other
field of endeavor.
(2)
A publication which may be known as or considered to be a newsletter may qualify
as a periodical if it conforms to the above standards. Where a newsletter has no signed
articles, but has a staff of writers who originally prepare articles, such publication will be
considered to have articles by different authors. If a publication has been classified by the
United States Postal Service as one which is entitled to second class mailing privileges, that
fact will be considered in determining whether or not the publication is a periodical.
Section 526.6(c)(1) of the regulations provides as follows:
(c) Resale exclusion. (1) Where a person, in the course of his business operations,
purchases tangible personal property or services which he intends to sell, either in the form
in which purchased, or as a component part of other property or services, the property or
services which he has purchased will be considered as purchased for resale, and therefore not
subject to tax until he has transferred the property to his customer.
Issue 1
Pursuant to the provisions of regulation section 526.6(c)(1), the purchase of printing by
Petitioner for its NIE Information Service and Circulation Idea Service qualify as a purchase for
resale. Similarly, the purchase of the training video tape qualifies as a purchase of property for
resale.

-3­
TSB-A-87(43)S
Sales Tax
November 12, 1987
Accordingly such purchases are exempt from tax when Petitioner presents to its printer and tape
supplier properly completed Resale certificates (Form ST-120).
Issue 2
The NIE Information Idea Services and the Circulation Idea Services do not meet the criteria
for qualification as newspapers. However, they do qualify as periodicals within the meaning of
regulation section 528.6(c). As such, they are exempt from sales tax pursuant to section 1115(a)(5)
of the Tax Law when sold by Petitioner.
Issue 3
The sale of training videos is the sale of tangible personal property within the meaning of
section 1105(a) of the Tax Law. Since the training videos do not qualify as newspapers or
periodicals, their sale by Petitioner is subject to sales tax. Petitioner is required to collect and remit
sales tax on all training videos delivered within New York State.

DATED: November 12, 1987

s/FRANK J. PUCCIA
Director
Technical Services Bureau

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.