Is a landlord who only rents show space — without organizing the shows — a 'promoter' who must meet New York's show-permit rules?

Plain-English summary

Madison Square Garden Center, Inc. rents space and building-related services to show organizers, who subdivide and sublet the space to individual show vendors. Madison Square Garden does not itself organize or conduct the shows. It asked whether a landlord in that position is a "promoter" under New York's sales-tax show rules.

The Department held that a space-only landlord can indeed be a promoter.

• The definition reaches landlords. Under Tax Law § 1131(5), a promoter is anyone who, directly or indirectly, rents or licenses space to vendors for the display or sale of taxable property or services at more than three shows in a calendar year. A "show" (§ 1131(6)) includes flea markets, craft/antique/coin/stamp/comic-book shows, fairs, and similar events with more than one vendor.
• Permanent premises don't exempt you. The regulation makes clear that the permanence of the building is irrelevant — what matters is the transient nature of the vendors (short-term leases, cancelable on short notice, merchandise removed at day's end) (20 NYCRR 533.1(c)). A shopping-mall or arena owner can be a promoter as to the transient show vendors while not being a promoter as to permanent tenants.
• So Madison Square Garden is a promoter once it passes three shows. If the Center provides space for more than three shows in a year, it is operating as a promoter. A separate organizer that rents the space may or may not also be a promoter, depending on how many shows it runs; if both qualify, they are co-promoters and file a single notice/application (each co-promoter files a Report of Show, but only one must list the vendors).
• Promoter duties. Obtain and display a Permit to Operate a Show (Form PR-169.2); allow only registered vendors (certificate of authority posted) to sell taxable goods; file a Report of Show (Form TP-375.2) with each participant's name, address, sales-tax ID, and rental charge (listing exempt-only sellers separately); and keep supporting records (20 NYCRR 533.1(c), (d); 533.2(e)(7); 533.3(i)).
• Practical points. When it rents to the organizer of a single yearly trade show (who runs no other shows), that organizer is not a promoter — so the Center, as promoter, must ask the organizer's representative to supply the vendor information for the Report of Show. And because only one permit is needed for multiple shows at the same location, the Center can simplify its duties by obtaining permits that cover multiple shows.

What this means for you

Owning the venue can make you the promoter — even if you never organize a show. New York's definition reaches anyone who rents space to vendors at more than three shows a year. If your hall, arena, mall, or lot hosts a steady stream of shows, you likely carry promoter duties for those transient vendors.

Permanent buildings and permanent tenants are treated separately from transient show vendors. The rules key on the vendors' transience, not the building's. You can be a promoter as to weekend show vendors while owing nothing extra as to your regular long-term tenants.

There can be two promoters — coordinate the filings. If both the venue and the show's organizer cross the three-show line, they're co-promoters: each files a Report of Show, but they can agree on who lists the vendors. And a single permit can cover multiple shows at one site, so plan permits to cover your season.

Common questions

Q: We only rent out the space — the organizer runs the show. Are we a promoter?
A: Yes, if your venue hosts more than three shows a year. The definition reaches anyone who rents space to vendors at more than three shows, whether or not you organize them.

Q: Our building is permanent. Doesn't that take us out of the "show" rules?
A: No. The rules focus on the transient nature of the vendors, not the building. A permanent venue can still be a promoter as to short-term show vendors.

Q: The organizer we rent to only runs one show a year. Who files?
A: That organizer isn't a promoter, so as the venue-promoter you must file the Report of Show — and you must ask the organizer to supply the vendor information you need to complete it.

Citations and references

Statutes and regulations:

• Tax Law § 1131(5) — "promoter": renting space, directly or indirectly, to vendors for taxable sales at more than three shows a year (or operating more than three shows)
• Tax Law § 1131(6) — "show": a flea market, craft/antique/coin/stamp/comic-book show, fair, or similar event with more than one vendor selling taxable property or services
• 20 NYCRR 533.1(c), (d); 533.2(e)(7); 533.3(i) — the building's permanence is irrelevant (vendor transience controls); permit, vendor-registration, Report-of-Show, co-promoter, and recordkeeping duties

Forms and guidance referenced:

• Form PR-169.2 (Permit to Operate a Show); Form TP-375.2 (Report of Show); Form TP-375.3 (Information for Promoters); Publication 815; TSB-M-80(8)S

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1986.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a86_32s.pdf

Original ruling text

New York State Department of Taxation and Finance
TSB-A-86(32)S
Sales Tax
September 3, 1986

Taxpayer Services Division
Technical Services Bureau
STATE OF NEW YORK
STATE TAX COMMISSION
ADVISORY OPINION

PETITION NO. S860422B

On April 22, 1986, a Petition for Advisory Opinion was received from Madison Square
Garden Center, Inc., Four Pennsylvania Plaza, New York, New York 10001.
The issue raised is whether a landlord who provides solely space and building related services
to show promoters for subdivision and rental to show vendors, but does not itself organize and
conduct shows, is a promoter under the Sales and Use Tax Law and Regulations.
Section 1131(5) of the Tax Law describes a "Promoter" as:
...any person who, either directly or indirectly, rents, leases or grants a license to use
space to any person for the display for sale or for the sale of tangible personal
property or services subject to tax, at more than three shows during the calendar year,
or who operates more than three shows during the calendar year. For purposes of
determining whether three shows have been held, the conduct of an activity described
in subdivision six on one day alone or on a series of up to seven consecutive days
shall be deemed to constitute a single show.
In section 1131(6) of the Tax Law, a "Show" is stated to include:
...a flea market, craft show, antique show, coin show, stamp show, comic book show,
fair and any similar show, whether held regularly or of a temporary nature, at which
more than one vendor displays for sale or sells tangible personal property or services
subject to tax.
Regulation Section 533.1(c) explains further:
(2). . . .
(i) For purposes of determining the existence of a show, the permanent nature
of the premises or structure in which the activity is held is not relevant. Instead, it
is the transient nature of the vendors which is relevant. Accordingly, when there are
two or more vendors operating on the same premises, and two or more vendors have
leases or licenses to use such premises for a period of less than one year or where the
leases or licenses to use may be cancelled on notice of less than 30 days, then a show
is presumed to exist for all purposes of this Part. Another fact which indicates the
existence of a show is where the vendors regularly remove their merchandise from
the premises at the close of each business day.
(ii) If no taxable tangible personal property or services are displayed for sale
or sold, then the activity is not a show for purposes of this subdivision.
RODERICK G. W. CHU, COMMISSIONER
GABRIEL B. DiCERBO, DEPUTY COMMISSIONER
FRANK J. PUCCIA, DIRECTOR
TP-8 (3/83)

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TSB-A-86(32)S
Sales Tax
September 3, 1986

(iii) Sales of food and drink for consumption on the premises, although taxable, will
not be considered for purposes of determining the existence of a show. Further,
admission charges for games of chance or skill, like those typically operated on a
carnival midway, although taxable, will not be considered for purposes of
determining the existence of a show.
(3). . . A person may be a promoter with respect to show vendors operating on his
premises, and at the same time not a promoter with respect to vendors who have
permanent places of business on the same premises. . .If there is more than one
person involved in the organization or operation of a show who is within the
definition of promoter, then all such persons must file a single notice of show and
application for show permit as co-promoters.
Example 1:

A, the owner of the X shopping mall, leases an area in the mall to B
for the purpose of holding a flea market on each of five weekends
during the year. B intends to sublease space to individual show
vendors. If neither A nor B is involved in organizing or operating any
show other than at the X shopping mall, then, after the third weekend
the flea market is held, both A and B are promoters subject to this
subdivision. While A, the owner of the X mall, is a promoter with
respect to the show vendors participating in the flea market, A is not
a promoter with respect to the permanent vendors of the X mall.

Example 2:

A, the owner of the X shopping mall, leases area in the mall to B for
the purpose of holding a flea market on the first weekend of July. B
intends to sublease portions of the mall area to individual show
vendors. A is not involved in organizing or operating any other show
during the calendar year. B, however, will operate similar shows on
three weekends during June at a location other than the X shopping
mall. With regard to the flea market at the X shopping mall, A is not
a promoter, but B is a promoter subject to this subdivision.

Promoters must file a notice of show and an application for show permit 10
days prior to the opening of the fourth show.
Publications of the Department of Taxation and Finance offer additional interpretations of
the Tax Law and Regulations as follows: "The promoter organizes or operates a show by granting
the use of a location." (Sales Tax Information for Show Vendors and Promoters, Publication 815
[3/85]).

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TSB-A-86(32)S
Sales Tax
September 3, 1986

"Owners or renters of parking lots, shopping malls, hotels, or other real property at which
shows are held and organizers of shows . . . are promoters."
(Information for Promoters, Form TP-375.3 [3/84]).
"After the third . . . show during the calendar year held at the same location or operated or
sponsored by the same individual or organization, the operator, sponsor or site owner will be
required to comply with the show promoter requirements of the Sales and Use Tax Law." (Technical
Services Bureau Memorandum, Show Promoter Requirements as They Apply to Farmers' Markets,
July 10, 1980, TSB-M-80(8)S).
Accordingly, if Petitioner provides space for more than three shows during the calendar year
it will be operating as a promoter. The organization renting the space may or may not also be a
promoter depending on whether or not they have held more than three shows during the year. If both
the Petitioner and the show organizer are promoters under the law, each will be subject to the
requirements stated in the Sales and Use Tax Regulations which are summarized as follows:
1.

To obtain a show permit for the fourth and each subsequent show in a calendar year
(Permit to Operate a Show, Form PR-169.2), and to prominently display it at the
main entrance to the show.

2.

To allow only registered vendors who have properly posted their certificate of
authority at their show booth to display or sell goods subject to sales tax.

3.

To file a Report of Show (Form TP-375.2) listing names, addresses, New York sales
tax identification numbers, and rental charges per month for each participant. The
report should list separately vendors claiming exclusively tax exempt sales.

4.

To maintain supporting records.

20 NYCRR 533.1(c), (d); 533.2(e)(7); 533.3(i).
When a show has more than one promoter, each co-promoter must file a Report of Show (TP­
375.2), but only one co-promoter needs to list (on the back of the form) the participating vendors.
The co-promoters may decide by mutual agreement who is to furnish the show vendor information;
both, however, are responsible for the filing of the list. See Form TP-375.3 (3/84), Information for
Promoters, for detailed instructions.
Petitioner inquires as to its obligations under the law when renting space to the organizer of
a yearly trade show, who conducts no other shows during the year. For sales tax purposes, the
organizer of such a show is not a promoter. Petitioner, after the third show held on its premises in
a calendar year, is considered the promoter of the show. To fulfill the law's requirements, Petitioner
must ask the vendor's representative to supply the show vendor information (item 3. above)
necessary to file the Report of Show.

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TSB-A-86(32)S
Sales Tax
September 3, 1986

It should be noted that only one "Permit to Operate a Show" (Form PR-169.2 [12/84]) is
needed when more than one show is held at the same location. Thus, Petitioner can simplify its
duties as a promoter by obtaining, whenever possible, permits that cover multiple shows.

DATED: September 3, 1986

s/FRANK J. PUCCIA
Director
Technical Services Bureau

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