Were charges for wedding videography, editing home videos, and duplicating customer tapes taxable?

Plain-English summary

A videographer asked about wedding and birthday videos, editing a customer's home video, and duplicating a customer's video. The Board concluded that all three charges were taxable.

Transferring a videotape to the customer was a retail sale of tangible personal property. Producing or processing customer-furnished property was also a sale under the cited statute, so videography remained taxable even if the client supplied both the camera and the tape.

The qualified-motion-picture rules did not exclude these transactions. The cited law and regulation specifically excluded private, noncommercial productions such as wedding or graduation family mementos from the definition of a qualified motion picture. Editing and duplication charges for the assumed home-video use were therefore taxable as well.

Citations and references

• California Revenue and Taxation Code sections 6006, 6006(b), 6010.6, 6010.6(b)(3), and 6051 (as cited and quoted or described concerning retail sales, customer-furnished materials, qualified motion pictures, and private noncommercial use)
• California Civil Code section 1656.1 (as cited concerning the contractual nature of collecting sales-tax reimbursement from a customer)
• California Sales and Use Tax Regulation 1529 and 1529(b)(1)(B), quoted to exclude private noncommercial wedding or graduation family mementos, accident-reconstruction legal-analysis videotapes, and student class-project films from qualified motion pictures (as cited)
• December 15, 1992 videographer letter prompted by a customer's request for proof and asking about wedding or birthday videos, editing a home video, and duplicating a customer video — request, attachments, customer inquiry, and correspondence history not reproduced in the official PDF
• Redacted videographer account and described private-event production, customer-furnished camera and tape possibility, home-video editing, duplication, and assumed private noncommercial use — customer contracts, production orders, source tapes, equipment records, edited works, duplicates, invoices, and payment records not reproduced in the official PDF
• January 7, 1993 senior-tax-counsel response signed by Ronald L. Dick — no videographer reply, implemented billing, tax return, audit, assessment, refund claim, agency adoption, appeal, or later outcome supplied
• Official Annotation 295.1505's three service categories, customer-furnished camera and tape treatment, private-noncommercial assumption, qualified-motion-picture exclusion, taxable conclusions, and January 7, 1993 date — annotation omits the absent request and customer's proof inquiry, sales-tax-reimbursement contract point, statutory and regulatory citations, accident-reconstruction and student-film examples, redacted account, missing records, later outcome, and reliance status and supplies no additional proceeding record

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/295-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/295-1505.pdf

Original ruling text

295.1505

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

MEMBER
First District

1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
(916) 445-6450

BRAD SHERMAN
Second District, Los Angeles
ERNEST J. DRONENBURG, JR.
Third District, San Diego
MATTHEW K. FONG
Fourth District, Los Angeles

January 7, 1993

GRAY DAVIS
Controller, Sacramento

BURTON W. OLIVER
Executive Director

Mr. D--- J. V--D--- V--XXX --- -----, CA XXXXX
SR -- XX-XXXXXX
Dear Mr. V---:
This is in reply to your December 15, 1992 letter regarding the application of sales tax to your charges for videotapes. You explained that you are a videographer. Typically you make wedding videotapes. One of your customers asked you for proof that sales tax applies to your charge. You asked whether you must charge sales tax on your charges for “(l) Wedding Videos, Birthday Video, etc, (2) Editing Someone's Home Video, (3) Duplicating A Customer's Video.” We assume that the customer's video to which you refer is for private, noncommercial use. Generally, California sales tax is imposed upon all retailers at the applicable rate of the gross receipts from the sale of all tangible personal property sold at retail in this state. (Rev. & Tax. Code § 6051.) Whether or not the retailer collects reimbursement for the tax from the customer is a matter of contract between the retailer and the customer. (Civ. Code § 1656.1.) Revenue and Taxation Code section 6006 defines “sale” to mean and include any transfer of title or possession, in any manner or by any means whatsoever, of tangible personal property for a consideration. When you provide a videotape to a customer, your charge is subject to sales tax. Subdivision (b) of section 6006 further defines sale to include the producing, fabricating, or processing of tangible personal property for a consideration for consumers who furnish, either directly or indirectly, the materials used. Therefore, if you perform videophotography for a client, your charge is subject to sales tax even if the client were to provide the videotape and camera.

Mr. D--- J. V---

-2-

January 7, 1993
295.1505

As you noted, Sales and Use Tax Regulation 1529, Motion Pictures, provides that certain charges are nontaxable when the charge is for the transfer of a “qualified motion picture” or for “qualified production services” performed in connection with the production of a qualified motion picture. Those provisions result from Revenue and Taxation Code section 6010.6 which excludes such transactions from the definition of “sale” for purposes of the Sales and Use Tax Law. Subdivision (b)(3) of section 6010.6 specifically provides that the term “qualified motion picture” does not include motion pictures produced for private noncommercial use, such as weddings or graduations. In this regard, Regulation 1529 provides at subdivision (b)(l)(B): “Qualified motion picture does not include motion pictures produced for private noncommercial use, such as motion pictures of weddings or graduations to be used as family mementos, accident reconstruction videotapes to be used for legal analysis, or student films to be used for class projects.” You are correct in your conclusion that, since the videotapes you produce are not qualified motion pictures, sales tax applies to your charges for the videotapes. Tax applies to your charges for editing home videos, and tax applies to your charges for duplicating a customer's video. We hope this answers your questions; however, if you need further information, feel free to write again. Very truly yours,

Ronald L. Dick
Senior Tax Counsel
RLD:sr