Is a company's information service — a listing of area events sent to newspapers, radio stations, and TV stations — subject to New York sales tax?

Plain-English summary

A company compiled a daily listing of events in the New York metropolitan area — political, special, and sports events across the nineteen counties of the New York market — and delivered it by fax or email to newspapers, radio stations, and television broadcasters (including cable newsrooms) to help them gather and report the news. It asked whether that service was taxable.

New York taxes information services under Tax Law § 1105(c)(1): collecting, compiling, or analyzing information and furnishing reports of it to others. So, as a general matter, the company's event-listing service is exactly the kind of service that section taxes.

But § 1105(c)(1) contains a specific carve-out written into the statute itself: it excludes "information services used by newspapers, radio broadcasters and television broadcasters in the collection and dissemination of news." Because the company's customers were precisely those news organizations, using the listings to gather and report news, the Department held the sales to them are excluded from tax. To document the exclusion, the seller should obtain an Exempt Use Certificate (Form ST-121) from each such customer.

What this means for you

Companies that sell news, listings, or data to media outlets

If you sell an information service and your customer is a newspaper, radio broadcaster, or television broadcaster using it to collect and disseminate news, the sale falls within the statutory news-media exclusion and is not taxable. Protect that treatment by getting a completed Form ST-121 from each media customer and keeping it on file.

Newspapers, stations, and newsrooms buying information services

Information you buy to gather and report the news qualifies for the § 1105(c)(1) exclusion. Be ready to issue an Exempt Use Certificate to your vendors so they do not have to charge you tax on those purchases.

Accountants and tax professionals

The key is who the buyer is and how it uses the service. The same event-listing feed is taxable when sold to a non-media customer and excluded when sold to a qualifying broadcaster or newspaper for news use. The exclusion is buyer- and use-specific, so the documentation (Form ST-121) matters.

Common questions

Q: Aren't information services taxable in New York?
A: Generally yes. Section 1105(c)(1) taxes the service of collecting, compiling, or analyzing information and furnishing reports of it. This ruling turns on a specific exclusion, not on the service being non-taxable in general.

Q: Why is this particular service not taxed?
A: Because the statute expressly excludes information services used by newspapers, radio broadcasters, and television broadcasters in the collection and dissemination of news, and the company's customers used the listings for exactly that.

Q: What does the seller need to document the exclusion?
A: The Department directs the seller to obtain an Exempt Use Certificate (Form ST-121) from its media customers when making these sales.

Q: Would the same feed be taxable if sold to a non-media buyer?
A: The exclusion is limited to qualifying news-media buyers using the service to collect and disseminate news. Sales of the same information service to other customers would ordinarily be taxable under § 1105(c)(1).

Q: Can another business rely on this opinion?
A: No. An advisory opinion binds the Department only as to the petitioner and the facts described. It illustrates the Department's reasoning, but your facts may differ.

Citations and references

Statutes:

• Tax Law § 1105(c)(1) (tax on information services, with an exclusion for information services used by newspapers, radio broadcasters, and television broadcasters in the collection and dissemination of news)

Forms:

• Form ST-121, Exempt Use Certificate

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1993.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a93_27s.pdf

Original ruling text

New York State Department of Taxation and Finance
TSB-A-93 (27)S
Sales Tax
April 20, 1993

Taxpayer Services Division
Technical Services Bureau

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S930119C

On January 17, 1993 a Petition for Advisory Opinion was received from Dynamic News
Diary, Inc., 599 Lexington Avenue, Suite 2300, New York, New York 10022.
The issue raised by Petitioner, Dynamic News Diary, Inc., is whether its information service
is subject to sales tax when purchased by newspapers, radio stations, and television stations.
Petitioner provides, by facsimile transmission or electronic mail, a listing of events in the
New York Metropolitan Area including political, special event and sports events in the nineteen
A&B Counties of the New York ADI as defined by Arbitron. The information is sold to newspapers,
radio stations, and television broadcasters including cable television newsrooms for use in the
collection and dissemination of news.
Section 1105(c)(1) imposes a tax upon:
"(1) The furnishing of information by printed, mimeographed or multigraphed
matter or by duplicating written or printed matter in any other manner, including the
services of collecting, compiling or analyzing information of any kind or nature and
furnishing reports thereof to other persons, but excluding the furnishing of
information which is personal or individual in nature and which is not or may not be
substantially incorporate in reports furnished to other persons, and excluding the
services of advertising or other agents, or other persons acting in a representatives
capacity, and information services used by newspapers, radio broadcasters and
television broadcasters in the collection and dissemination of news." (Emphasis
supplied)
Sales by Petitioner of the information services described above are ordinarily subject to the
tax imposed under Section 1105(c)(1) of the Tax Law. However, when the services are purchased
by newspapers, radio broadcasters and television broadcasters such services are excluded from the
imposition of sales tax. Petitioner should obtain an Exempt Use Certificate (Form ST-121) from its
customers when making such sales.

DATED: April 20, 1993

/s/
PAUL B. COBURN
Deputy Director
Taxpayer Services Division

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