Is video production services subject to the Sales Tax?

A videographer can use the Sales Tax exemption for photographers & photo finishers when buying equipment directly used in producing a video. The definition of a photographer includes a person engaged in the business of performing a photography operation using videotape. When you sell the video service, you should collect Sales Tax.

A photographer is a person engaged in the business of performing the total photography operation of picture taking, development of exposed film and the finishing and printing of pictures. The term also includes a person engaged in the business of performing a photography operation using microfilm, videotape, videocassettes or the like.
 

Effective August 1, 2016, licensees are now required to collect tax on digitally or electronically delivered or streamed video, photographs, books, any other taxable printed material, apps, games, music, any audio service including satellite radio or canned software. These items are taxable whether accessed and purchased singly, or by subscription or in any other manner. Any maintenance, updates or support on these items are taxable.
Taxable sales on these items made on or after August 1, 2016, must be included when filing sales tax returns. The date of sale is the date of the invoice or other similar document.

The regulation is section 32.37, which follows:

§ 32.37. Photographers and photo finishers.
(a) Scope. Photographers, photo finishers and photo-refinishers are vendors of photographs, materials and services purchased by their customers, whether or not produced to the special order of the customer. The photographer or photo finisher shall collect and remit tax upon the total purchase price charged for the photographs or services, even though the customer may furnish some of the materials. Photo-refinishers shall collect and remit tax upon the total purchase price charged for the rendering of the photo-refinishing service. In determining total purchase price, there may be no deduction for ancillary expenses, including travel time and expenses, telephone calls, salaries or wages paid to assistants, models or narrators, whether or not the expenses are separately stated in billings to purchasers.
(b) Manufacturing exemption. The purchase or use of materials, equipment and supplies by a photographer or photo finisher is exempt from tax if the property is predominantly used directly by him in the photography or photo finishing operation. This exemption is restricted to photographers and photo-finishers and is not available to photo-refinishers.
(1) Property directly used. The following are examples of equipment, parts and accessories, and materials and supplies which when predominantly used directly by a photographer or photo finisher in the operation of photography shall be exempt from tax: cameras, film, camera or flash batteries, processing chemicals, special lighting, tripods, filters, cable release mechanisms, light measuring devices, screens, props, proofing machines, enlargers, developing trays, fixing trays, film and print washing machines, brushes and color crayons, densitometers, enlarging meters and automatic rocker trays.
(2) Property not directly used. The following are examples of equipment, materials and supplies which do not qualify for the manufacturing exemption: camera cases, gadget bags, lens cases, projectors, screens, projection lamps, projection tables, stands, slide files, motion picture reels and cans, viewers, viewing tables, negative files, negative envelopes, bulk film loaders, film cassettes, paper safes and cleaners for film and lenses.
(3) Repairs. The repair of equipment predominantly used directly by the photographer or photo finisher in his photography or photo finishing operation shall be exempt from tax. This exemption also applies to the purchase of replacement parts for the equipment.
(4) Utilities. That portion of the photographers or photo finishers utilities which are directly used in his manufacturing operations shall also be exempt from tax. Fuel or power used to ventilate buildings, for general illumination lighting, air conditioning and other space cooling, and space heating shall be subject to tax unless it is established that the use of these utilities bears an active causal relationship to the photographers or photo finishers manufacturing operations.
(c) Resale exemption. Photographers, photo finishers and photo-refinishers may claim the resale exemption on purchases of tangible personal property which they directly resell or incorporate into products which they resell.