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The State of Wyoming issued a bulletin in regards to the taxability of photography. This bulletin stated that the sales price paid for photographs, photo equipment and supplies, photography and photo developing, and printing are subject to sales tax. The basis for the taxation is that the process of photography creates a photograph, which is considered to be tangible personal property. The bulletin further stated that a photographer’s materials, labor, and service charges are considered to part of the sales price of the photographs produced for retail sale. In keeping with that theory, the State also indicated that materials and supplies consumed in the process of producing photographs intended for resale shall be exempt from sales tax as they are integral to creating the photographs, which will be sold taxable at retail. A more significant aspect of this bulletin is that the State of Wyoming stated that even photographs produced digitally would be considered tangible personal property and therefore subject to the rules outlined above. (Sales and Use Tax Bulletin #14, Wyoming Department of Revenue, January 20, 2005)


In a recent Wyoming appeals case it was upheld that the Department of Audit’s use of estimates to determine tax owed was legal in some instances. Wyoming law states that if a taxpayer’s records are insufficient, an auditor can use reasonable estimates to determine a taxpayer’s liability. Wyoming law places the ultimate burden of proof on the taxpayer as to the completeness and accuracy of records and amounts due to the government. If a taxpayer provides sufficient evidence that their tax liability is different than what the state determined under audit, the burden becomes the state’s to prove otherwise. (Appeal of Ronald E. Waugh d/b/a Capt’n Ron’s Rodeo Bar, Docket No. 2003-24, May 11, 2004.)


Janitorial services are not taxable in the state of Wyoming because the individuals working this type of service are deemed real property contractors. The Wyoming Department of Revenue does not license these individuals as vendors so they have absolutely no responsibility to collect and remit sales and use tax. However, the supplies and materials purchased to perform these janitorial activities are taxable and subject to the state sales and use tax. (Wyoming Department of Revenue Response to CCH, Decided April 23, 2004)


The exemption applies to all sales or leases executed on or after July 1, 2004 and currently this exemption is set to expire on December 31, 2010. In order to qualify for the exemption the manufacturer must be classified under the NAICS code manufacturing sector 31-33. NextIn addition, the machinery and equipment must be used directly and predominantly in manufacturing tangible personal property. Finally, the machinery must be capitalized or expensed under section 179 of the Internal Revenue Code. (Sec. 39-15-105(a)(viii)(O))


The manufacturing process is considered to begin at the point when raw material is moved from plant inventory and to end at the point at which manufacturing has altered the material to its completed form. The ending point includes the packaging of such products, if required. Exempt machinery is defined to be tangible personal property that is used to move, process, or test material during the continuous flow of processing to create a new product, article, substance, or commodity that is different and distinct in nature, character, or use from the raw or prepared material that entered at the beginning of the manufacturing process. (Ch 27 (HB 44), Laws 2004, effective July 1, 2004)



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