Is renting equipment, set dressings, and picture cars for a television or movie production exempt from Texas sales tax?

Subject

Sets For Movie/Film

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9402L1286F07

Plain-English Summary

This short letter confirms that, effective October 1, 1993, a producer may claim an exemption from Texas tax on qualifying machinery or equipment rented or leased for the production of a motion picture, or a video or audio recording, provided a copy of that production will be sold, licensed, distributed, broadcast, or exhibited. The letter was written in response to a question about exemptions for production companies renting equipment and props for a television production.

The Comptroller specifically confirms that this exemption extends to renting set dressings and picture cars for use in producing a television program — not just cameras or core filming equipment.

What This Means For You

If you are a television, film, video, or audio production company operating in Texas: You may claim a tax exemption on qualifying machinery or equipment you rent or lease for the production, as long as a copy of the finished work will be sold, licensed, distributed, broadcast, or exhibited. This can include set dressings and picture cars, not only cameras or sound equipment.

If you rent equipment, props, set dressings, or vehicles to production companies: Be prepared to accept a claim of exemption for these rentals when the renter is using the items in a qualifying motion picture, video, or audio production, since this letter confirms the Comptroller's position that such rentals fall within the exemption.

Timing matters: The exemption described in this letter took effect October 1, 1993. Rentals before that date are not addressed here.

Q&A

Q: Can a TV or film production company avoid Texas sales tax on equipment it rents for a shoot?
A: Yes. Effective October 1, 1993, a producer may claim an exemption from tax on qualifying machinery or equipment rented or leased for producing a motion picture or a video or audio recording, as long as a copy will be sold, licensed, distributed, broadcast, or exhibited.

Q: Does the exemption cover things like set dressings and picture cars, or just filming equipment?
A: It covers set dressings and picture cars too. The letter specifically states that a tax exemption may be claimed when renting set dressings and picture cars for use in the production of a television program.

Original ruling text

February 15, 1994

Dear **:

Ms. Gieder asked me to answer your letter concerning the exemptions
for production companies renting equipment and props for a television
production.

Effective October 1, 1993, a producer may claim an exemption from
tax on qualifying machinery or equipment rented or leased for the
production of a motion picture or a video or audio recording, a copy
of which will be sold, licensed, distributed, broadcast or exhibited.
You may claim a tax exemption when renting set dressings and picture
cars for use in the production of a television program.

If you have any questions or need information, my number is
1-800-531-5441 ext. 3-4614. Or you may write to the Tax Administration
Division.

Sincerely,

Adina Whittemore
Tax Administration Division

NOTE: Previous Accession Number 9402061L