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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
S
515.0000 Service Enterprises Generally—Regulation 1501
Annotation 515.0002.650
(a) In General—Service Distinguished from Sale
515.0002.650 Business Directories. A taxpayer accumulates information about other businesses in certain geographic regions for compilation into computer disks and/or reference books. The taxpayer thereafter leases these disks and books to its customers.
Where the directory was specifically created, collected, or completed to meet a customer's particular order, the transaction is generally regarded as a nontaxable service transaction (Regulation 1501). In this type of situation, the transfer of a single copy of the compiled information on a computer disk or paper report is considered incidental to the providing of the service and tax only applies to the sale of such materials to the seller of the service. However, where a transaction involves the delivery of tangible personal property which includes information not customized to a customer's order (including a report previously prepared by the retailer on a custom basis), the transaction is a sale or lease of tangible personal property and is subject to tax unless an exemption otherwise applies. 8/1/95.