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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
A B C D E F G H I J L M N O P R S T U V W X
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330.0000 Leases of Tangible Personal Property—In General—Regulation 1660
Annotation 330.3565
(b) Rental Receipts—Items Included and Excluded
330.3565 Services that Are Part of the Lease. A lessor is in the business of leasing costumes to the motion picture and television industries. Under the terms of the lease, the lessee (producer) must either clean the costumes before returning them or pay the lessor for this service. Other services provided are alterations, dying, and on occasion selection of costumes for the producer when the producer's wardrobe personnel are not available. Charges for these services are separately invoiced to the producer.
With respect to these leases under which these services are performed, the lessee must pay for those services both as a condition of the lease and in order to make use of the costumes. The fact that the producer may avoid the charges by performing these services itself, e.g., selecting the wardrobe, etc., does not mean that these services are not part of the lease when the parties so agree. Thus, the separately stated charges for alterations, selecting, cleaning and dying are subject to tax. 9/23/83.