Were conference-bridging services run on equipment outside Florida subject to state or local communications services tax?

Plain-English summary

The taxpayer connected teleconference participants through conference-bridging equipment represented to be entirely outside Florida. Customers paid their own telecommunications providers for calls, while the taxpayer supplied only the bridging function.

Florida treated conference bridging as a communications service because the bridge transmitted or routed voice or other signals among participants. But a state or local communications services tax applied only if the service originated and terminated in Florida, or originated or terminated in Florida and was charged to a Florida service address.

Because the bridge was the place where the service originated and customers received it, the represented out-of-state equipment location kept the service outside Florida tax under the stated sourcing conditions.

What this means for you

Classification and sourcing are separate questions. A service can be a taxable type of communications service but remain outside Florida tax when its origination, termination, and service-address facts do not connect it to the state.

Common questions

Was conference bridging a communications service? Yes.

Why was this provider's service not taxed? The bridge location and stated sourcing facts placed origination and receipt outside Florida.

Would a Florida service address always be enough? The cited test also required the service to originate or terminate in Florida.

Citations and references

• Fla. Stat. §§ 202.11, 202.12, and 202.19, as quoted and discussed in the advisement.

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 11A19-001

Original ruling text

SUMMARY
QUESTION: Whether Taxpayer’s sales of conference bridging services are subject to Florida
communications services tax and local communications services tax (“CST”).
ANSWER: Taxpayer’s conference bridging service is not subject to Florida communications
services tax or local communications services tax if the service provided is neither originating
and terminating in Florida nor originating or terminating in Florida and being charged to a
Florida service address.
March 1, 2011
XXX
Re:

Technical Assistance Advisement 11A19-001
XXX
Conference Bridging Services
Communications Services Tax
Chapter 202, Florida Statutes

Dear XXX:
This letter is a response to your petition dated October 27, 2010, for the Department's issuance of a
Technical Assistance Advisement ("TAA") concerning the above referenced party and matter. Your
petition has been carefully examined and the Department finds it to be in compliance with the
requisite criteria set forth in Chapter 12-11, F.A.C. This response to your request constitutes a TAA
and is issued to you under the authority of Section 213.22, F.S.
Facts and Requested Advisement

Whether Taxpayer’s sales of conference bridging services are subject to Florida communications
services tax and local communications services tax (“CST”).
Stated Facts
Taxpayer provided the following information in its Request for a Technical Assistance
Advisement dated October 27, 2010:

The taxpayer provides teleconferencing services, (a.k.a. conference bridging
services), to customers throughout the United States and occasionally foreign
locations. The process is initiated by the customer calling a toll free or long

Technical Assistance Advisement
Page 2
distance number provided by the taxpayer. The taxpayer provides ONLY the
bridging service they do not provide any telecommunications service.
The taxpayer’s customer, or user of the service, pays their own
telecommunications provider for the long distance charges incurred by the call.
When the customer uses the toll free number supplied by the taxpayer, the
taxpayer pays all fees, taxes, surcharges, and transmission charges to the
taxpayer’s telecommunications supplier and does not separately assess a per
minute charge for the toll free line associated with the conference call.
Each call is routed to the taxpayer’s conference bridging equipment where all
incoming participants are connected to one conference call. The conference
bridging equipment is located 100% outside the State of Florida. A
teleconferencing service involves transmitting, conveying, or routing of voice
signals between and among communication lines[,] which[] occurs at the
conference bridge. If not for the conference bridge, there would be no
transmission or routing of voice signals between and among the participants in a
teleconference. Hence, the conference bridging service originates and terminates
outside of Florida.
We agree that a teleconferencing service utilizing a conference bridge located in
Florida would be subject to the communications services tax but because the
service originates and terminates outside of Florida it would be subject to the tax
in the taxpayer’s home [s]tate where the conference bridging equipment is located
and should not be subject to the Florida Communications Services tax.
The taxpayer does not maintain a business location or any tangible equipment or
property in the State of Florida. Some Florida sales are generated by Independent
Contractor Sales Agents (Agents), who perform sales solicitation for numerous
companies throughout the United States as well as the taxpayer referenced above.
The Agents are not considered employees and their actual time spent in Florida is
undeterminable by the taxpayer.

We do not believe that any documents involved in the transaction are relevant to
the decision requested. We will promptly supply any documents you request to
assist in your determination.

On November 5, 2010, in response to the Department’s request for additional documentation,
Taxpayer provided an email with the following statement:

Technical Assistance Advisement
Page 3
. . . The [Taxpayer] does not enter into contracts with its clients, which is why no
contracts were included with the original TAA request. The industry as a whole
stopped using contracts some time ago as it became to[o] restricting on the
customers and [Taxpayer] followed suit.
The entire transaction is detailed in the fact pattern on the TAA request.
Additionally, we have included below a PDF file of a brochure that is supplied to
customers explaining the service and how to use it. The [Taxpayer’s] number is to
a [non-Florida] location where all the conferencing bridging equipment, support
personnel, and company operations take place.
Taxpayer’s brochure provides the following regarding use of Taxpayer’s services:

XXX

Taxpayer Position
Taxpayer states, in part, the following in its letter dated October 27, 2010:

Taxpayer asserts that the conference bridging service is not subject to the Florida
Communications Services Tax. Telecommunications services are broadly defined
in s. 202.11(2) F.S. For the communications services tax to apply to the sales of
communications services, (e.g. conferencing services using a conference bridge),
the service must either originate and terminate in Florida; or, originate or
terminate in Florida and be charged to a Florida service address. (See ss. 202.12
and 202.19, F.S.)
As mentioned above the conference bridging equipment is located 100% outside
of Florida 1 and therefore the conference bridging service is not subject to the
communications services tax because it neither originates nor terminates in
Florida.

Discussion of Applicable Law
1

Taxpayer provided sworn affidavits setting forth that the location of the bridging equipment is outside the State of
Florida. The brochure provided by the Taxpayer states a toll-free number and a toll number containing an out of
state area code. No documentation was provided by the Taxpayer that indicates the location of the bridging
equipment.

Technical Assistance Advisement
Page 4

The term “communications services” is broadly defined in s. 202.11(2), F.S., and means, in part,
“the transmission, conveyance, or routing of voice, data, audio, video, or any other information
or signals . . . to a point, or between or among points . . . .”
According to the stated facts, Taxpayer’s conferencing bridging services involve connecting two
or more participants in an audio or video conference at a conference, so that the participants can
see, hear, and/or speak to each other. All participants either call a toll free telephone number or a
toll number 2 that rings into the conference bridge where all participants are connected or linked
together in a conference. Since a conference bridging service involves the transmission or
routing of signals between and among the participants at the bridge, it is a communications
service as defined above.
For Florida communications services tax and local communications services tax to apply to the
sale of a communications service (e.g., conferencing bridging service), the service must either
originate and terminate in Florida; or, originate or terminate in Florida and be charged to a
service address in Florida. The term “service address” means in part, “the location of the
communications equipment from which communications services originate or at which
communications services are received by the customer. (See ss. 202.11(14), 202.12 and 202.19,
F.S.).
Based upon the information provided, it is at the conference bridging equipment where the
Taxpayer’s communications services originate and are being received by its customers. It is at
this location, said by the Taxpayer to be outside Florida, that all of the participants are connected
or linked together in order to communicate with each other. If the conference bridging service
being provided is neither originating and terminating in Florida nor originating or terminating in
Florida and being charged to a Florida service address, then it is not subject to Florida
communications services tax or local communications services tax.
Conclusion
Taxpayer’s conference bridging service is not subject to Florida communications services tax or
local communications services tax if the service provided is neither originating and terminating
in Florida nor originating or terminating in Florida and being charged to a Florida service
address.
This response constitutes a Technical Assistance Advisement under Section 213.22, F.S., which
is binding on the Department only under the facts and circumstances described in the request for
this advice as specified in Section 213.22, F.S. Our response is predicated on those facts and the
specific situation summarized above. You are advised that subsequent statutory or administrative
2

According to the Taxpayer, participants calling the toll number to reach the conference bridge separately incur
long distance charges from their respective long distance telecommunications services providers. The taxability of
these charges is not addressed in this advisement.

Technical Assistance Advisement
Page 5
rule changes, or judicial interpretations of the statutes or rules, upon which this advice is based,
may subject similar future transactions to a different treatment than expressed in this response.
You are further advised that this response, your request and related backup documents are public
records under Chapter 119, F.S., and are subject to disclosure to the public under the conditions of
Section 213.22, F.S. Confidential information must be deleted before public disclosure. In an effort
to protect confidentiality, we request you provide the undersigned with an edited copy of your
request for Technical Assistance Advisement, the backup material and this response, deleting names,
addresses and any other details which might lead to identification of the taxpayer. Your response
should be received by the Department within 15 days of the date of this letter.
Sincerely,

Heather S. Miller
Tax Law Specialist
Technical Assistance & Dispute Resolution
(850) 717-7104
Record ID: 92116