Was a personalized 20-page horoscope taxable when prepared from each customer's date, time, and place of birth?

Plain-English summary

A prospective provider would receive each customer's date, time, and place of birth and deliver approximately 20 pages of information about that person.

California treated the horoscope as a nontaxable service. The customer primarily wanted the horoscope's personalized contents rather than the written pages themselves, each report was individually prepared, and the charge probably would not depend on page count.

The source warned that mere stock horoscopes could be taxable property sales.

What this means for you

Personalized report providers

Customer-specific inputs and information value supported service treatment; standardized stock reports pointed toward taxability.

Accountants and tax professionals

Review personalization, stock content, pricing method, page or copy count, printing, digital delivery, and whether the buyer seeks information or a publication.

Common questions

Q: Was the personalized horoscope taxable?

A: No.

Q: Did the 20-page written delivery make it taxable?

A: No.

Q: Could stock horoscopes be taxable?

A: Yes.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Annotation page: Annotation 515.0011.400
• Original supporting opinion: 515.0011.400 PDF

Original ruling text

515.0011.400

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
October 28, 1969
Attention: REDACTED TEXT
Gentlemen:
This is in reply to your letter of October 13, 1969, in which you request our opinion as to the application of the sales tax to the activities of your client, who intends to engaged in the business of providing horoscopes. We understand that the customer provides information concerning his date, time, and place of birth to the company, and the company in turn delivers to the customer approximately twenty pages of information concerning the customer. In our opinion your client’s services are not subject to the sales tax. The sales tax applies to the gross receipts from the retail sale of tangible personal property, whereas persons in the business of rendering services are consumers, not retailers, of any tangible personal property which they use incidentally in rendering the service. The basic distinction in determining whether a particular transaction involves a sale of tangible personal property or the transfer of tangible personal property incidental to the performance of a service is one of the true object of the contract; that is, is the real object sought by the buyer the service per se or the property produced by the service? Persons in the business of providing horoscopes would seem, under the criteria set forth above, to be engaged in the performance of a service since (1) the customer’s primary interest would be the contents of the horoscope and not the horoscope as a written object of property, (2) the horoscope would be prepared on an individual basis, and (3) the charge for the horoscope would probably not vary with the number of pages provided the customer. We note that if the horoscopes were sold as mere stock items, their sale might well be subject to tax. Very truly yours, Gary J. Jugum Assistant Tax Counsel GJJ:ph bc:

REDACTED TEXT – District Administrator
Headquarters – Audit Evaluation and Planning (HR)