Is a company's charge to remove a wheel 'boot' from an illegally parked car subject to New York sales tax — as a parking service or as servicing tangible personal property?

Plain-English summary

A-Z Parking Services, Inc. is hired by owners of private streets and commercial properties to enforce their no-unauthorized-parking rules. Its "booting" teams find an unauthorized vehicle, clamp an immobilizing boot on a tire, sticker the windshield, photograph the car, and notify a central office. If the owner doesn't redeem the vehicle, a licensed tower removes it; if the owner comes first and pays the redemption charge, the team removes the boot. A-Z asked whether that charge is subject to sales tax as a parking service.

The Department drew a two-step conclusion:

• Booting is not a taxable "parking" service. Immobilizing a vehicle parked without authorization on private property is not the service of providing parking, garaging, or storing motor vehicles under § 1105(c)(6) (nor under the New York City parking-service taxes in §§ 1107(c) and 1212-A). A-Z isn't operating a garage or lot that parks or stores cars.
• But the boot-removal fee is taxable as servicing tangible personal property. The charge is a fee to remove the boot, and the boot is tangible personal property. Under § 1105(c)(3) and § 527.5(a), attaching and removing the boot is deemed installing, maintaining, servicing, and repairing tangible personal property, so the receipts from the redemption fee are subject to sales tax. The Department cited 1983 Atty Gen [Inf Opns] 83-12 (a village may charge the reasonable cost of attaching/removing an immobilizing device) and Forest Hills Gardens Assn. & A-Z Parking Services v. Baroth, 555 NYS2d 1000 (upholding a $95 boot-removal fee as legal and reasonable).

What this means for you

Not every vehicle-related charge is a "parking" charge

New York taxes the service of parking, garaging, or storing motor vehicles, but immobilizing a car is not the same as storing it. If your business only boots and releases vehicles — without operating a lot that parks or stores them — the § 1105(c)(6) parking tax isn't the right pigeonhole.

The theory that makes the fee taxable is "servicing tangible personal property"

The Department taxed the charge by characterizing the boot itself as tangible personal property and the attach/remove work as servicing it under § 1105(c)(3). The practical result: the redemption/boot-removal fee is taxable, so a booting operator should collect sales tax on it.

A tow that follows is a separate transaction

The opinion notes the redemption charge can bundle the operator's charge plus a towing company's fee; the tax analysis here focuses on the boot-removal fee as servicing of tangible personal property.

Common questions

Q: Is a fee to remove a wheel boot from an illegally parked car taxable in New York?
A: Yes. It is treated as servicing/repairing tangible personal property (the boot) under § 1105(c)(3), so the redemption fee is subject to sales tax.

Q: Isn't booting a taxable parking service?
A: No. The Department held booting is not the service of providing parking, garaging, or storing motor vehicles under § 1105(c)(6) (or the NYC parking taxes).

Q: Does it matter that the enforcement is on private property under contract with the owner?
A: The private-property context is why it isn't a parking-lot service; the taxable hook is instead the servicing of the boot itself.

Citations and references

Statutes, regulations, and authorities:

• Tax Law § 1105(c)(6) — tax on providing parking, garaging, or storing motor vehicles (held inapplicable to booting)
• Tax Law § 1105(c)(3) and 20 NYCRR § 527.5(a) — tax on installing, maintaining, servicing, or repairing tangible personal property (the basis for taxing the boot-removal fee)
• Tax Law §§ 1107(c) and 1212-A — New York City parking-service taxes (same result: booting not covered)
• 1983 Atty Gen [Inf Opns] 83-12; Forest Hills Gardens Assn. & A-Z Parking Services, Inc. v. Baroth, 555 NYS2d 1000

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1991.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a91_42s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-91 (42)S
Sales Tax
May 17, 1991

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S910306A

On March 6, 1991, a Petition for Advisory Opinion was received from A-Z Parking Services,
Inc., 69-12 Austin Street, Forest Hills, NY 11375.
The issue raised by Petitioner, A-Z Parking Services, Inc., is whether the sales tax imposed
upon the sale of service of providing parking, garaging or storing for motor vehicles by persons
operating a garage, parking lot or other place of business engaged in providing parking, garaging or
the storing of motor vehicles applies to the service of immobilizing vehicles parked without
authorization on private property prior to their being towed away unless first redeemed by the vehicle
owner or operator.
Petitioner is engaged by owners of various private streets and various commercial
establishments to operate a program designed for the purpose of enforcing the property owner's
prohibition against unauthorized parking of motor vehicles upon the private property of such owners.
Prominent signs inform the public that parking by unauthorized vehicles is prohibited and that
offenders are subject to having their vehicles immobilized and/or towed away.
Petitioner sends around on the private streets a "booting" team which, when it discovers an
unauthorized parked vehicle, applies an immobilization device called a "boot" to one or two tires of
the vehicle, attaches a sticker to the windshield warning that any movement of the vehicle while the
boot is attached could damage the vehicle, photographs the vehicle for purposes of defending
damage claims and notifies the central office of the immobilization. After a reasonable period of
time, if the car owner or operator has not redeemed the vehicle, a licensed towing company is called
to remove from the private streets and hold it until redeemed (the charge for which encompasses not
only the Petitioner's charge but also the towing fee of the towing company). If prior to the removal
by the towing company the vehicle's owner or operator comes to the Petitioner's office to redeem the
vehicle, the "booting" team will go to the vehicle and remove the "boot".
Petitioner employs between 10 and 25 full and part-time drivers to perform the "booting"
operation. Petitioner maintains, in the near vicinity of one of the private communities it serves, an
office that is open and manned at all times when vehicles are "booted" so that the vehicle owner or
operator can pay the redemption charge to secure the release of vehicle from the immobilizing
device. In the case of other locations, the vehicles owner or operator can telephone the office and
a "booting" team will be dispatched to the location to collect the redemption charge and release the
vehicle.
Petitioner regularly sends its personnel around to check on the security of "boots" that have
been installed on unauthorized vehicles. This is solely because of the numerous instances where the

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Sales Tax
May 17, 1991
vehicle operator has endeavored to remove the "boot" by various means including hacksaws, bolt
cutters, crow bars and acetylene torches.
Section 1105 of the Tax Law states, in part:
Imposition of sales tax.--. . .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.
Section 1212-A of the Tax Law imposes a tax within any city in the state with a population
of over one million upon receipts "from every sale of the service of providing parking, garaging or
storing for motor vehicles by persons operating a garage. . ., parking lot or other place of business
engaged in providing parking, garaging or storing for motor vehicles".
Section 1107(c) of the Tax Law imposes the same sales tax using the same language on
behalf of the New York City Municipal Assistance Corporation.
Section 1105(c)(3) of the Tax Law provides, in part, that:
(3)
Installing tangible personal property, excluding a mobile
home, or maintaining, servicing or repairing tangible personal
property, including a mobile home, not held for sale in the regular
course of business, whether or not the services are performed directly
or by means of coin-operated equipment or by any other means, and
whether or not any tangible personal property is transferred in
conjunction therewith. . .:
Section 527.5(a) of the Sales and Use Tax Regulations states, in part, that:
(1) The tax is imposed on receipts from every sale of the services of installing,
maintaining, servicing or repairing tangible personal property, by any means
including coin-operated machines, whether or not any tangible personal property is
transferred in conjunction with the services.
(2) Installing means setting up tangible personal property or putting it in place for
use.
*
*
*

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Sales Tax
May 17, 1991
(3) Maintaining, servicing and repairing are terms used to cover all activities that
relate to keeping tangible personal property in a condition of fitness, efficiency,
readiness or safety or restoring it to such condition.
The service of "booting" vehicles, which are parked without authorization on private property
does not constitute the sale of service of providing parking, garaging or storing of motor vehicles by
persons operating a garage, parking lot or other place of business engaged in providing parking,
garaging, or storing of motor vehicles pursuant to Sections 1105(c)(6), 1107(c) and 1212-A of the
Tax Law.
However the charge imposed by the Petitioner in the instant case is a fee for the removal of
the boot from the vehicle which is tangible personal property. In 1983 Atty Gen [Inf Opns] 83-12
the Attorney General stated that a village may fix a fee to assess the reasonable cost of attaching and
removing a boot or locking device which immobilizes a vehicle which is in violation of local parking
regulations. Also in the Matter Forest Hills Garden Association and A-Z Parking Services, Inc. v.
Bernard D. Baroth, etal., 555 NYS 2d 1000 the court held that the plaintiffs had the right to
immobilize unauthorized parked vehicles through the application of a boot, and that the redemption
fee of $95 to remove the boot is a legal, valid and currently reasonable charge. (emphasis added)
Accordingly, pursuant to Section 1105(c)(3) of the Tax Law and Section 527.5(a) of the Sales
and Use Tax Regulations the attaching and removing of a boot immobilizing a vehicle is deemed to
be the installing, maintaining, servicing and repairing of tangible personal property. Therefore, the
receipts from charges or fees for the removal of the boot are subject to the imposition of sales tax.

DATED: May 17, 1991

s/PAUL B. COBURN
Deputy Director
Taxpayer Services Division

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