Is a public university's separate vehicle-registration fee subject to New York sales tax, and what about its parking fee?

Plain-English summary

A SUNY campus charges students and staff two genuinely separate fees for using a vehicle on campus: a $20-per-vehicle "registration" fee that funds tracking who owns which vehicle (for safety, emergency contact, and traffic-control purposes) and confers no right to park, and a separate parking fee (ranging from $0 for certain unionized employees to $70) that actually buys the privilege of parking on campus. The two fees are separately itemized, tracked in separate accounts, and someone can owe multiple registration fees (one per vehicle) but only a single parking fee.

The Department held the registration fee escapes sales tax entirely -- since registering a vehicle isn't itself an enumerated taxable service, it can only be taxed if it's really a disguised parking charge, and here it plainly isn't, because registering confers no parking rights and the university's own statutory authority to regulate campus traffic and safety is a distinct legal basis from its parking operations. That contrasts with an earlier ruling for a different SUNY campus, where the "registration" fee actually functioned as the price of parking and was found taxable -- the key fact here is that this university's registration and parking charges are functionally, not just nominally, distinct. The parking fee itself, however, is taxable: even though SUNY is generally an exempt governmental entity, that exemption doesn't cover services "of a kind ordinarily sold by private persons" -- and parking is exactly that kind of service, so the university must collect sales tax on its parking fee the same as a commercial garage or lot would.

What this means for you

Public universities, agencies, and other governmental entities

Being a tax-exempt governmental entity doesn't exempt every fee you charge -- only fees for property or services NOT ordinarily sold by private persons. Parking is a classic example of a service private businesses sell, so a governmental entity's parking charges stay taxable even though the entity itself is generally exempt. If you want a separate administrative or registration fee to escape tax, make sure it's functionally distinct from parking (confers no parking right, serves an independent safety/record-keeping purpose) rather than just relabeled parking revenue.

Students, staff, and visitors paying campus vehicle fees

Expect sales tax on your parking fee but not on a genuinely separate vehicle-registration fee, if your campus structures the two that way -- check your invoice for how the charges are itemized.

Accountants and tax professionals

This is a useful compare-and-contrast pair with the Department's earlier Stony Brook opinion, which found a similarly named "registration" fee was taxable because it functioned as the actual price of parking. The lesson: label alone doesn't control -- what matters is whether the fee genuinely confers a parking privilege or serves a separate, non-parking purpose.

Common questions

Q: Is a university's vehicle registration fee taxable?
A: Not if it's a genuinely separate charge that confers no parking privilege and serves an independent purpose (like safety tracking and traffic control) -- but a similarly labeled fee that actually functions as the price of parking would be taxable.

Q: Is a public university's parking fee taxable?
A: Yes. Parking, garaging, or storing motor vehicles is a taxable service under Tax Law § 1105(c)(6), and it's a kind of service ordinarily sold by private persons, so the general governmental exemption doesn't apply to it.

Q: Does it matter that some employees pay $0 for parking under a union agreement?
A: No -- they still owe the registration fee for each vehicle, and the $0 parking rate for them doesn't change the taxability analysis of parking fees paid by others.

Q: Can another SUNY campus or government entity rely on this ruling for its own fee structure?
A: No. It binds the Department only for this petitioner and these facts; another entity's fee structure needs its own review, especially given the contrary result in the Department's earlier Stony Brook opinion on similar-sounding facts.

Citations and references

Statutes and guidance:

• Tax Law § 1101(b)(3) (receipt)
• Tax Law § 1105(c)(6) (parking, garaging, or storing services)
• Tax Law § 1116(a)(1) (exempt governmental entities)
• 20 NYCRR 527.1(b) (taxable and exempt items sold as a single unit)
• General Construction Law § 66 (public/municipal/district/public benefit/education corporation definitions)
• Education Law § 216-a (education corporation)
• Education Law § 352.1 (State University of New York)
• Education Law § 360 (SUNY power to regulate campus traffic and parking)
• TSB-A-98(5)S (State University of New York at Binghamton, Feb. 2, 1998)
• TSB-A-00(4)S (State University of New York at Stony Brook, Jan. 28, 2000)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2005.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a05_23s.pdf

Original ruling text

New York State Department of Taxation and Finance

TSB-A-05(23)S
Sales Tax
June 22, 2005

Office of Tax Policy Analysis
Technical Services Division
STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S040628C

On June 28, 2004, the Department of Taxation and Finance received a Petition for
Advisory Opinion from University at Albany, SUNY, 1400 Washington Avenue, Albany, NY
12222.
The issue raised by Petitioner, University at Albany, SUNY, is whether vehicle
registration fees collected by Petitioner from students and staff are subject to sales tax.
Petitioner submitted the following facts as the basis for this Advisory Opinion.
Petitioner charges a vehicle registration fee which covers the cost of documenting
vehicles that may be on campus. The revenue collected from vehicle registration is placed in a
separate account and is used to offset the cost associated with having personnel input data
collected concerning the identification and ownership of vehicles parked on campus. More
specifically, the revenue from vehicle registration supports the payment of labor and fringe
benefit expenses for office staff to accept, process and distribute registrations, the cost and
maintenance of an information system to record and track the registered vehicles, the purchase of
registration stickers, postage and printing costs, and general office expenses for the registration
staff. The cost of enforcing the registration requirement includes both labor and fringe benefit
expenses for staff to verify that only registered vehicles use campus parking facilities and
maintenance costs for the equipment used to verify registrations. The vehicle registration
information enables Petitioner to, among other things, identify and contact the owners of
vehicles so registered in the event of emergencies. The registration fee revenue ensures adequate
parking for students and staff and compliance with Petitioner’s parking regulations through a
comprehensive enforcement program. For the 2004-2005 academic year the registration fee for
all students and staff is $20 per year per vehicle registered. Registration alone, however, confers
no parking privileges on the registrant.
Petitioner also charges a separate parking fee which confers on registrants the privilege of
parking on the campus. The parking fee schedule for the 2004 - 2005 academic year ranges from
$0.0 (for certain unionized employees under the terms of their collective bargaining agreements)
to $70 for non-unionized employees and employees of corporations affiliated with Petitioner.
The parking fee for undergraduate students is a component of Petitioner’s Comprehensive
Service Fee. The registration and parking fees are separately itemized on Petitioner’s invoices,
and the parking fee revenues are maintained separately from the registration fee revenues for
accounting and financial reporting purposes. Revenue from the parking fee is placed in a
separate account and used to maintain Petitioner’s parking lots (e.g., paving, painting, snow
removal, and security).

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June 22, 2005

A registration sticker is provided to persons who have registered their vehicle. A person
who wishes to park on campus who uses more than one vehicle and therefore desires to register
more than one vehicle pays one parking fee (e.g., $70 for the non-unionized employees) and
multiple registration fees ($20 for each of the vehicles). An individual registration sticker is
provided for each vehicle and a single separate hang tag, referenced to each of the registered
vehicles for which parking is valid, is provided to be placed inside the particular vehicle being
used and parked. The registration stickers are marked to denote that a hang tag must be
displayed in conjunction with that registration and the hang tag is marked to denote the
registrations for which it is valid. For persons who pay a fee for parking and register only a
single vehicle, the registration sticker itself is marked to reference that the vehicle is eligible to
be parked on campus. Persons who for various reasons (e.g., certain unionized employees) are
not required to pay for parking, must nonetheless pay the registration fee and they are likewise
issued a registration sticker that reflects that the vehicle is registered and eligible to be parked
upon campus. Visitors to the campus may be required to pay a parking fee but are not required to
pay a registration fee.
Applicable law and regulations
Section 1101(b)(3) of the Tax Law, in defining the term receipts for purposes of the sales
tax sets forth, in pertinent part, that receipt means “the sale price of any property and the charge
for any service taxable under this article....”
Section 1105 of the Tax Law provides, in part:
Imposition of sales tax On and after June first, nineteen hundred seventy-one,
there is hereby imposed and there shall be paid a tax ... upon:
*

*

*

(c) The receipts from every sale, except for resale, of the following services:
*

*

*

(6) Providing parking, garaging or storing for motor vehicles by persons operating
a garage (other than a garage which is part of premises occupied solely as a private one or
two family dwelling), parking lot or other place of business engaged in providing
parking, garaging or storing for motor vehicles provided, however, this paragraph shall
not apply to such facilities owned and operated by a public corporation, as defined by
section sixty-six of the general construction law, other than a public benefit corporation,
as defined by such section sixty-six, created by interstate compact or at least half of
whose members are appointed by the governor, or any agency or instrumentality of a
municipal corporation or district corporation as defined by such section sixty-six....

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Sales Tax
June 22, 2005

Section 1116 of the Tax Law provides, in part:
Exempt organizations (a) Except as otherwise provided in this section, any sale
or amusement charge by or to any of the following or any use or occupancy by any of the
following shall not be subject to the sales and compensating use taxes imposed under this
article:
(1) The state of New York, or any of its agencies, instrumentalities, public
corporations (including a public corporation created pursuant to agreement or compact
with another state or Canada) or political subdivisions where it is the purchaser, user or
consumer, or where it is a vendor of services or property of a kind not ordinarily sold by
private persons;
Section 527.1(b) of the Sales and Use Tax Regulations provides:
Taxable and exempt items sold as a single unit. When tangible personal property,
composed of taxable and exempt items is sold as a single unit, the tax shall be collected
on the total price.
Example: A vendor sells a package containing assorted cheeses, a cheese board
and a knife for $15. He is required to collect tax on $15.
Section 66 of the General Construction Law provides, in part:

1. A “public corporation” includes a municipal corporation, a district corporation,
   or a public benefit corporation.
2. A “municipal corporation” includes a county, city, town, village and school
   district.
3. A “district corporation” includes any territorial division of the state, other than
   a municipal corporation, heretofore or hereafter established by law which possesses the
   power to contract indebtedness and levy taxes or benefit assessments upon real estate or
   to require the levy of such taxes or assessments, whether or not such territorial division is
   expressly declared to be a body corporate and politic by the statute creating or
   authorizing the creation of such territorial division.
4. A “public benefit corporation” is a corporation organized to construct or
   operate a public improvement wholly or partly within the state, the profits from which
   inure to the benefit of this or other states, or the people thereof.
   *

*

*

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June 22, 2005

6. An “education corporation” is a corporation as defined in subdivision one of
   section two hundred sixteen-a of the education law.
   Section 216-a of the Education Law provides, in pertinent part:
7. The term “education corporation” as used in this section means a corporation
   (a) chartered or incorporated by the regents or otherwise formed under this chapter, or (b)
   formed by a special act of this state with its principal purpose an education purpose and
   which is a member of the university of the state of New York,...
   Section 352.1 of the Education Law provides:
   There is hereby created in the state education department and within the
   university of the state of New York as established under the board of regents a
   corporation to be known as the state university of New York which shall be responsible
   for the planning, supervision and administration of facilities and programs in accordance
   with the plan proposed by the state university trustees as approved by the regents
   pursuant to section two hundred thirty-seven of this chapter. The state university shall
   provide for higher education supported in whole or in part with state moneys in
   accordance with the provisions of section three hundred fifty-eight hereof, and shall
   perform such other duties as may be entrusted to it by the provisions of this article and
   any other law. Subject to the terms of any agreement to which it is a party, such
   corporation shall have the care, custody, control and management of the lands, grounds,
   buildings, facilities and equipment used for the purposes of the state operated institutions
   of the state university, and it shall have power to protect, preserve and improve the same.
   Section 360 of the Education Law provides, in part:
   Powers to regulate traffic on university grounds 1. For the purpose of
   providing for the safety and convenience of its students, faculty, employees, and visitors
   within and upon the property, roads, streets, and highways under the supervision and
   control of the state university, the board of trustees is hereby authorized to:
   a. Adopt and enforce such provisions of the vehicle and traffic law, or any rules
   of the state department of transportation adopted under the authority of that law, as
   control or regulate vehicular or pedestrian traffic and parking.
   *

*

*

c. Adopt and enforce campus rules and regulations not inconsistent with the
vehicle and traffic law relating to parking, vehicular and pedestrian traffic, and safety.
Such rules and regulations may include provisions for ... the payment of fees for the
registration or parking of such vehicles, and the assessment of administrative fines upon

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June 22, 2005

the owner or operator of such vehicles for each violation of the regulations .... (emphasis
added)
Opinion
Petitioner is part of the State University of New York, a corporation created in the State
Education Department and within the University of the State of New York. See section 352.1 of
the Education Law. Petitioner’s governing Board of Trustees is empowered to adopt and enforce
campus rules relating to parking, vehicular and pedestrian traffic, and safety; including
provisions for the payment of fees for the registration or parking of vehicles. See section 360.1 of
the Education Law.
As described by Petitioner, the vehicle registration fees and the parking related fees are
two separate and distinct fees charged for two separate purposes. The registration fees and
parking fees are separately stated on Petitioner’s invoices. The registration fee confers no
parking privileges.
A person using more than one vehicle for transportation would incur a single parking fee
but would pay multiple registration fees of $20 for each of the vehicles being used on campus.
Those individuals who pursuant to negotiated union agreements are not required to pay for
parking privileges must pay the registration fee for each vehicle being used on campus. Visitors
to the campus may be required to pay a parking fee but are not required to pay a registration fee.
Since the service of registering a motor vehicle is not specifically enumerated in section
1105(c) of the Tax Law, the vehicle registration fees could only be found to be subject to sales
tax if they are considered to be receipts attributable to providing parking, garaging or storage of
motor vehicles, which are taxable services under section 1105(c)(6) of Tax Law.
In describing the purpose of the general requirement of New York State for all motor
vehicles to be registered, New York Jurisprudence 2d (8 NY Jur 2d, Automobiles, 82) states,
“The underlying purpose of these provisions is to establish a uniform system of operation and
use of motor vehicles, which will supervise vehicles, their movement and control, their identity
in relation to the public, and any resultant damage or injury they may occasion.” The purpose of
Petitioner’s registration requirement as it applies to the confines of the campus of Petitioner, is
similar to the purpose of the statewide registration requirement stated above. Petitioner’s
registration requirements are separately authorized powers granted by the Legislature and,
therefore, may properly be distinguished from Petitioner’s parking requirements.
Accordingly, Petitioner’s vehicle registration fees described in this Advisory Opinion are
not considered receipts from parking, garaging or storing of motor vehicles and therefore are not
subject to the sales tax imposed by section 1105 of the Tax Law. See also State University of
New York at Binghamton, Adv Op Comm T & F, February 2, 1998, TSB-A-98(5)S. Unlike State
University of New York at Stony Brook, Adv Op Comm T & F, January 28, 2000, TSB-A-00(4)S,

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June 22, 2005

which concluded that the vehicle registration fee in that case was subject to sales tax, Petitioner
in the present case indicates that it charges separate fees for vehicle registration and parking and
that registration confers no parking privileges.
Petitioner is an exempt government entity under section 1116(a)(1) of the Tax Law.
Petitioner’s sales, however, of tangible personal property or services of a kind ordinarily sold by
private persons are subject to sales tax. Petitioner’s parking services are of a kind ordinarily sold
by private persons and are subject to tax under section 1105(c)(6) of the Tax Law. Petitioner
appears to be an education corporation under section 216-a of the Education Law. Accordingly,
the exception from the imposition of the sales tax for public, municipal or district corporations,
or agencies and instrumentalities thereof, as provided in section 1105(c)(6) does not apply to
Petitioner. Therefore, Petitioner’s charges for separate parking fees are subject to sales tax under
section 1105(c)(6).

DATED: June 22, 2005

NOTE:

/s/
Jonathan Pessen
Tax Regulations Specialist IV
Technical Services Division

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