A state agency is hungrily checking bridal-show vendors for permits.
In my 20 years in this business, I have attended a ton of bridal shows, trade shows, conventions and chamber of commerce mixers. I have never been asked to produce any kind of business license, resellers permit or any other documentation. That’s about to change in California as cash strapped California agencies are hunting for money.
In the latest quest to grab dollars on the table, the California State Board of Equalization, an agency tasked with collecting sales and use taxes, has set its sights on small businesses. Specifically, vendors such as caterers, photographers and people that sell cakes at bridal shows are being targeted.
In a letter issued by the Board of Equalization to bridal show promoters in California, April Barnes, business tax representative for the agency, specifically requests a list of all vendors for review. In a phone call to clarify what businesses need a seller’s permit, Barnes cites photographers, videographers, bakers, flower shops, bridal stores and caterers, and all that provide a tangible product for sale.
While you may see a photographer as providing a service, the end service is a tangible product that the client gets to keep in the form of photos printed on paper and photos presented on a disc. Yeah, that disc has a value. Although it might be a buck to you and me, the State of California is looking for its piece of the pie. Speaking of pie, that wedding cake, it too is a tangible item, although it is food and food is typically exempt from sales tax. Not so fast! Prepared food is a different story. So, when you go to McDonald’s you pay a tax on your Big Mac. If you go to the grocery store and buy meat, buns and cheese, there is no tax due.
In another surprising revelation, bridal coordinators may need a selling permit too. If they offer things such as centerpieces, linen tablecloths or anything tangible as use during your ceremony, it is considered a rental of the item and use tax must be paid on the value of those items. This certainly seems to be a stretch for some dollars and won’t amount to a whole lot of anything. It also seems to be another smack in the face to California’s small businesses. So much for the American dream!
The good news for now is……limousine operators are exempt from sales tax. We already pay though PUC quarterly filings on our income. But save this article and mark my prediction that the idea of asking us to collect tax from our clients and pass it on to the state is already in the works.
— Jim Luff, LCT contributing editor
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