Is a SUNY college's mandatory $30 vehicle registration fee subject to NY sales tax when the same fee also grants on-campus parking privileges?

Plain-English summary

A State University of New York (SUNY) college charges a $30 annual fee to register any vehicle parked on campus. The fee is meant to defray the cost of registering and tracking vehicles, issuing decals, and related processing; every vehicle parked on campus must be registered annually and display a valid decal. The college asked whether the fee is subject to sales tax.

The Office of Counsel concluded the fee IS taxable, because the single fee buys parking privileges as well as registration.

• Government doesn't mean automatically exempt. As part of SUNY, the college is an exempt governmental entity (Tax Law 1116(a)(1)). But a government entity's sales of services of a kind ordinarily sold by private persons are taxable. Parking is exactly that kind of service, taxable under 1105(c)(6).
• The public-corporation carve-out doesn't apply. Section 1105(c)(6) excepts parking provided by a public, municipal, or district corporation -- but the college is a corporation created under the Education Law (352.1), so that exception doesn't reach it.
• One fee for both = a taxable parking charge. Under the college's own traffic regulations, paying the single registration fee also entitles the payer to park on campus: one fee, one permit/decal, which confers the right to park in the designated areas. Because the college does not charge two separate fees and does not require separate permits for registration and parking, the whole fee is a taxable parking charge (1105(c)(6); 20 NYCRR 527.1(b)).
• Contrast: separate fees. In University at Albany (05(23)S), Oneonta (01(20)S), and Binghamton (98(5)S), the schools charged a separate mandatory registration fee and a distinct parking fee -- and the registration-only fee was held not taxable. The result here (single combined fee taxable) follows Stony Brook (00(4)S).

What this means for you

Colleges, universities, and other government entities charging vehicle fees

If you bundle registration and parking into one charge, expect the whole fee to be treated as a taxable parking service -- being a government or educational entity doesn't exempt services that private businesses ordinarily sell. If you want the registration component to be non-taxable, structure it as a genuinely separate registration fee with its own purpose and (ideally) its own permit, distinct from a separately charged parking fee. How you label a line item matters less than whether the payer is really buying parking with it.

Anyone selling parking/garaging

Parking, garaging, and storing motor vehicles is a taxable service under 1105(c)(6) regardless of who provides it, unless a specific exception (like the public/municipal/district corporation carve-out) actually applies to you.

Common questions

Q: We're a public college -- aren't we tax-exempt on what we charge?
A: Your purchases as a government entity may be exempt, but your sales of services ordinarily sold by private businesses (like parking) are taxable. The 1116(a)(1) exemption doesn't cover them.

Q: How could we make the registration fee non-taxable?
A: Charge a separate registration fee distinct from a separate parking fee, as in the Albany/Oneonta/Binghamton opinions. A single fee that also confers the right to park is taxed in full as a parking charge.

Citations and references

• Tax Law section 1105(c)(6) (tax on parking, garaging, storing of motor vehicles; public-corporation exception)
• Tax Law section 1116(a)(1) (exemption for governmental entities)
• Education Law sections 352.1, 360 (SUNY colleges; power to regulate campus traffic)
• 20 NYCRR 527.1(b) (receipts subject to tax)
• TSB-A-05(23)S (Univ. at Albany); TSB-A-01(20)S (Oneonta); TSB-A-98(5)S (Binghamton); TSB-A-00(4)S (Stony Brook)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2010.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a10_8s.pdf

Original ruling text

New York State Department of Taxation and Finance

TSB-A-10(8)S
Sales Tax
February 25, 2010

Office of Counsel
Advisory Opinion Unit
STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S091229A

Petitioner name and address redacted asks whether its vehicle registration fees collected from
students and others are subject to New York State sales taxes.
We conclude that Petitioner’s vehicle registration fees which encompass vehicle registration for
both the purpose of controlling vehicles on campus and parking privileges are subject to sales tax.
Facts
Petitioner is a part of the State University of New York. Petitioner charges a $30.00 registration
fee for all vehicles that are parked on campus. The registration fee is intended to defray Petitioner’s costs
of registering and accounting for all vehicles on campus, annual decals, and related processing. All
vehicles parked on campus must be registered annually. The registration fee is accounted for as a discrete
fee in the college’s accounting records.
Pursuant to section 360 of the Education Law (Power to Regulate Traffic on University Grounds)
regulations were enacted relating to the regulation of parking and traffic on Petitioner’s campus. These
regulations in pertinent part provide:
Registration. (a) Regardless of the ownership of the vehicle, all staff and students who
drive on campus must register their vehicles with the campus business office. Official college
identification decals will be issued for the current academic year (September to August) or
summer session upon payment of a fee approved by the chancellor or designee. All individuals
exercising the privilege are responsible at all times for the vehicle while the vehicle is on campus.
(b) Decals must be affixed no later than 48 hours after the first day of classes of that
session…..
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(d) Temporary or special use of a motor vehicle on campus requires that a temporary
permit be issued by the public safety office.
(e) When ownership of a registered motor vehicle is changed, the campus business office
must be advised within 48 hours and the decal must be removed from the vehicle.
(f) Parking permits are not transferable from the individual to whom they are issued to
any other individual. Permits are not transferable from one vehicle to another.
Penalties and procedures for violation of campus parking and traffic regulations.

TSB-A-10(8)S
Sales Tax
February 25, 2010

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(g) Campus motor vehicular registration and parking privileges shall be revoked for the
balance of the academic year upon a finding that 10 or more campus violations have been
incurred during an academic year.
Among other provisions, the regulations also provide for designated parking areas for students
and faculty, and penalties (fines) for violation of parking and other traffic infractions (speeding, etc.).
Petitioner’s Web site, in addition to presenting a restatement of the regulations, contains the
following additional statements: “All vehicles parked on campus must display a valid [Petitioner] decal”
and “Visitors can obtain free one-day passes at the University Police BEFORE parking.”
Analysis
Petitioner, as part of the State University of New York, is a corporation created in the State
Education Department and within the University of the State of New York, under the Board of Regents.
Thus, Petitioner is an exempt governmental entity under Section 1116(a)(1) of the Tax Law. However, a
governmental entity’s sales of tangible personal property or services of a kind ordinarily sold by private
persons are subject to sales tax. A governmental entity’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 is a
corporation created under the Education Law (See Education Law §352.1). Accordingly, the exception
from the imposition of the sales tax for public, municipal, or district corporations, as provided in Section
1105(c)(6), does not apply to Petitioner.
Petitioner has adopted regulations to 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. According to Petitioner’s traffic and parking regulations, when a person pays to register his
or her vehicle with Petitioner, that person is also entitled to the privilege of parking on the campus of
Petitioner. This is evidenced by the fact that a single fee is paid to register a motor vehicle with
Petitioner, which results in a permit being issued to the owner of the vehicle. That permit, when properly
displayed, confers the right to park in the appropriate (student, faculty, staff, etc.) designated areas on the
premises of Petitioner.
In University at Albany (SUNY), Adv Op Comm T&F, June 22, 2005, TSB-A-05(23)S; SUNY
College at Oneonta, Adv Op Comm T&F, May 24, 2001, TSB-A-01(20)S, and State University of New
York at Binghamton, Adv Op Comm T&F, February 2, 1998, TSB-A-98(5)S, the vehicle registration and
parking permit schemes imposed separate mandatory minimal registration fees for all vehicles and
separate (minimal in some cases and significant in others) fees charged for parking. It was concluded
under those circumstances that the registration fees were not subject to sales tax.
As the facts of this Petition and Petitioner’s traffic and parking regulations demonstrate,
Petitioner does not charge two separate and distinct fees for registration and parking, and does not require
separate permits for registration and parking. Petitioner’s single fee for both vehicle registration and
parking confers parking privileges for the vehicles displaying the registration decal. Therefore, since
Petitioner charges a single fee to cover vehicle registration and parking privileges on its campus, the
vehicle registration fee is subject to sales tax under Section 1105(c)(6) of the Tax Law. See Section
527.1(b) of the Sales and Use Tax Regulations. The conclusion in this Advisory Opinion is consistent

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TSB-A-10(8)S
Sales Tax
February 25, 2010

with State University of New York at Stony Brook, Adv Op Comm T&F, January 28, 2000,
TSB-A-00(4)S, in which the university’s annual registration/parking permit fee was held subject to sales
tax.

DATED: February 25, 2010

NOTE:

/S/
Jonathan Pessen
Director of Advisory Opinions
Office of Counsel

An Advisory Opinion is issued at the request of a person or entity. It is limited to
the facts set forth therein and is binding on the Department only with respect to
the person or entity to whom it is issued and only if the person or entity fully and
accurately describes all relevant facts. An Advisory Opinion is based on the law,
regulations, and Department policies in effect as of the date the Opinion is issued
or for the specific time period at issue in the Opinion.