Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-6-1 - GROSS PROCEEDS OF SALES; GROSS RECEIPTS; WHOLESALE SALES, SALES AT WHOLESALE; RETAIL SALES, SALES AT RETAIL; AUTOMOTIVE VEHICLES › Section 810-6-1-.130 - Printers

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Gross receipts
			 accruing from the retail sales of printed matter of all kinds are subject to
			 the sales tax. (Also see Rule
			 810-6-1-.137 entitled
Raw Materials and Supplies Purchased By Manufacturers and
			 Compounders
.)
(2)
			 Sales to consumers of printed matter such as catalogs, books, letterheads,
			 invoice forms, envelopes, folders, advertising circular, and the like by
			 printers or others engaged in selling printed matter are subject to the sales
			 tax. A printer may not deduct from the selling price of such tangible personal
			 property charges for the labor or service of performing the printing even
			 though such labor or service charges may be billed to the customer separately
			 from the charge for the stock. Such labor or service is embodied in and becomes
			 a part of the tangible personal property sold.
(3) Where printers purchased from the United
			 States Post Office stamped cards and envelopes and print thereon various
			 legends for customers, the printers must pay sales tax measured by their gross
			 proceeds of sales of the printed cards or envelopes to the customers. Such
			 cards and envelopes constitute tangible personal property and, if they are not
			 resold by such customers, the sales by the printers are at retail. Such
			 printers will not be required to pay sales tax on the amount of the postage
			 where stated separately in billing to customers.
(4) No tax arises from the service of
			 printing or from the service of typesetting performed by the printer for a
			 customer or for another printer where there is no transfer of ownership of
			 tangible personal property from the printer to his customer. (§
								40-23-1(a)(6)).
(5) Sales of materials to
			 printers are at wholesale, tax free, when such materials become a component of
			 the printed matter produced for sale. The machines used in the printing come
			 within the machine levy and are taxed at the one and one-half percent rate. The
			 supplies, materials, and equipment not becoming a component of the product sold
			 or not constituting a machine used in manufacturing are subject to the sales or
			 use tax, whichever may apply, at the general rate of four percent.
(6) Newspaper advertising supplements or
			 circulars inserted in newspapers usually fall in the following categories:
(a) A buyer enters into a contract with a
			 printer for the printing of advertising circulars, catalogs, etc., and directs
			 the printer to deliver the printed material to a newspaper or several
			 newspapers, or directs that they be delivered to another location, sometimes
			 the buyer's place of business. The buyer then enters into a second contract
			 with the newspaper for distribution of the inserts. That portion of advertising
			 supplements or inserts retained by the buyer for distribution to buyer's
			 customers, that do not become part of newspapers manufactured for sale, will be
			 subject to sales tax. However, those advertising supplements or inserts that
			 are delivered to the purchasers or newspaper companies to be inserted into and
			 become part of the newspaper are purchased at wholesale, tax free.
Ralph P. Eagerton, Jr. v. Dixie Color Printing
			 Corporation
.
(b)
			 Newspaper advertising supplements and inserts which are inserted into the
			 newspapers and sold as part and parcel of the newspaper, the retail sales of
			 which are subject to the sales tax, no sales tax arises where such advertising
			 supplements or inserts are:
(1) printed by
			 the publishers of the newspaper and inserted into and sold as part and parcel
			 of the newspaper published by such publishers, or
(2) printed by another printer for the
			 newspaper publisher and paid for by the newspaper publisher for insertion into
			 and sold as part and parcel of the newspaper.