Questions and Answers

Identifying Information:Photographers and photofinishers.
Tax Type:Kansas Retailers' Sales Tax
Brief Description:Photographers and photofinishers.
Approval Date:03/16/2005


Office of Policy & Research

March 16, 2005

Question: How does sales tax apply to photographers and photofinishers?

Answer: (1) Generally. In Kansas, photographers and photofinishers are treated like retailers. They must collect tax on the total selling price they charge on their retail sales of photographs, CD's, DVD's, video tapes, and other goods. In determining the selling price, no deductions are allowed for separately stated charges such as sitting fees or for ancillary expenses including travel time, meals, telephone calls, salaries or wages, models, and other similar expenses. Sales tax applies to the sale of photographs, CD's, DVD's, video tapes, and other goods produced to satisfy a contractual agreement entered into by a photographer. Examples of these sales include aerial photographs, security photographs, films, CD's, DVD's, and video tapes that are produced for a specific customer. The tax base for such sales include all of the photographer's expenses as well as any separately stated charges to the consumer. Charges for proofs and sitting fees are subject to tax even when the customer decides not to buy any photographs. As used here, a "photofinisher" includes a photo-refinisher and "photography" includes recording images with a digital or video camera.

(2) Consumed-in-production and ingredient-and-component part exemptions. Photographers who collect tax on sales of their photographs may claim exemption when buying chemicals, paper, film, and other materials that are consumed in developing film or printing photographs or that becomes a component part of the photographs being sold. If developing or printing services are purchased from a third party, the photographer or photofinisher may claim resale exemption for those purchases.

The ingredient-and-component-part exemption is limited to items that are or that become a physical part of the photographs, film, CD's, DVD's, video tapes, and other property delivered to the consumer, as well as to the sacks and envelopes that hold the property at the time of sale. The consumed-in-production exemption is limited to electricity, chemicals, and other property that is consumed when film is developed and when prints are produced for resale. Other than film, the consumed-in-production exemption does not extend to makeup, cleaners, flashbulbs, batteries, electricity, and other items that are used when a photograph is taken.

(3) Purchases for resale. Many photographers and photofinishers operate retail stores that sell goods to consumers. These goods can include photo albums, picture frames, film, cameras, lenses, camera cleaning supplies, CD's, DVD's, and digital memory cards among other things. Like other retailers, these businesses should claim a resale exemption when they buy goods to resell. To claim this exemption, photographers and photofinishers should provide each vendor with a completed Resale Exemption Certificate, Form ST28A, that identifies the purchases that are intended for resale.

(4) Items purchased for use by a photographer or photofinisher. Purchases of goods by photographers and photofinishers for their own use are taxable. These purchases include cameras, lenses, lights, screens, projection lamps and tables, stands, props, electricity, cleaners, darkroom equipment, and other property that is used in their business, except the consumables discussed in paragraph (2) and those things that become an ingredient or component part of the photographs and other goods being sold. Kansas photographers and photofinishers that buy items from out-of-state businesses for their own use should register for, report, and pay Kansas consumers use tax in the appropriate amount on such purchases.

(5) Manufacturing exemptions. Photographers and photofinishers may not claim exemption as manufacturers when they buy automated printing and developing equipment since they are not engaged in what is commonly regarded as an industrial processing operation and they use the equipment in their retail business operations.

(6) Place of sale. Under destination-based sourcing rules, local sales tax is sourced to the place where delivery is made to the buyer or buyer's agent in Kansas. This includes Kansas deliveries to an out-of-state resident who enters Kansas, takes possession of photographs here, and then return to his or her home state.

A photographer or photofinisher should not collect Kansas tax when it delivers photographs or other goods to a buyer or the buyer's agent in another state. Tax laws treats delivery as being made in another state when the ship-to address is outside Kansas and delivery is made by: (A) a vehicle operated by the photographer, photofinisher, or its agent; (B) the United State Postal Service; (C) a common carrier; or (D) a contract carrier paid for by the photographer or photofinisher. While Kansas tax does not apply to goods shipped or delivered by a Kansas seller to a buyer in another state, the State of delivery may require the Kansas seller to register and collect its tax on sales made there.

Date Composed: 03/16/2005 Date Modified: 03/16/2005