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BTLG Table of Contents > Sales and Use Tax Annotations > S > 527.0000 Sound Recording > Annotation 527.1100

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527.0000 Sound Recording—Regulation 1527

Annotation 527.1100

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527.1100 Sound Recording for Commercials. A firm produces sound recordings for use by advertising agencies in commercials for radio and television. It hires its own musicians, writes the music, and makes its own arrangements for the recording session. The session is recorded on 24 track 2" tape which is subsequently mixed down to ¼" mono or stereo and 3–4 cassette copies.

The firm consumes the 2" tape in manufacturing the ¼" tape, and therefore cannot purchase the 2" tape for resale. It is also the consumer of the ¼" tape which incorporates sound to be used on a film or videotape commercial since the creation of the music track is a "qualified production service". It is the retailer of the ¼" tape used in radio commercials. However, the tapes are "master tapes" and the measure of the tax is therefore limited to the sales price of the blank tape. 10/6/89.