HAR § 18-235-38-06.04 — Less: Total expenditures to date 300,000 Apportionable income $ 50,000 [Eff 3/11/96] (Auth: HRS §§231-3(9), 235-38, 235-118) (Imp: HRS §235-38) §18-235-38-06

04 Television and radio broadcasting. (a) When a person in the business of broadcasting film or radio programming, whether through the public airwaves, by cable, direct or indirect satellite transmission, or any other means of communication, either through a network (including owned and affiliated stations) or through an affiliated, unaffiliated, or independent television or radio broadcasting station, has income from sources both within and without Hawaii, the amount of business income from sources within Hawaii shall be determined pursuant to sections 235-21 to 235-39, HRS, or the Multistate Tax Compact (section 255-1, HRS), except as modified by this section. (b) For definitions, rules, and examples for determining whether income shall be classified as business or nonbusiness income, see sections 18-235-21-01 to 18-235-21-04. (c) In this section, unless the context clearly requires otherwise: “Film” or “film programming” means any and all performances, events, or productions telecast on television, including news, sporting events, plays, stories, or other literary, commercial, educational, or artistic works, through the use of video tape, disc, or any other type of format or medium. Each episode of a series of films produced for television shall constitute a separate film notwithstanding that the series relates to the same principal subject and is produced during one or more tax periods. “Outer-jurisdictional property” means tangible personal property, such as orbiting satellites, undersea transmission cables, and the like, that are owned or rented by the taxpayer and used in the business of telecasting or broadcasting, but that are not physically located in any particular state. “Radio” or “radio programming” means any and all performances, events, or productions that are broadcast on radio, including news, sporting events, plays, stories, or other literary, commercial, educational, or artistic works, through the use of an audio tape, disc, or any other format or medium. Each episode of a series of radio programming produced for radio broadcast shall constitute a separate radio programming notwithstanding that the series relates to the same principal subject and is produced during one or more tax periods. “Release” or “in release” means the placing of film or radio programming into service. A film or radio program is placed into service when it is first broadcast to the primary audience for which the program was created. Thus, for example, a film is placed in service when it is first publicly telecast for entertainment, educational, commercial, artistic, or other purposes. Each episode of a television or radio series is placed in service when it is first broadcast. A program is not placed in service merely because it is completed and therefore is in a condition or state of readiness and availability for broadcast, or merely because it is previewed to prospective sponsors or purchasers. “Rent” includes license fees or other payments or consideration provided in exchange for the broadcast or other use of film or radio programming. “State” includes the District of Columbia, the Commonwealth of Puerto Rico, or any possession or territory of the United States. A “subscriber” to a cable television system is the individual residence or other outlet which is the ultimate recipient of the transmission. “Telecast” or “broadcast” (sometimes used interchangeably with respect to television) means the transmission of television or radio programming, respectively, by an electronic or other signal conducted by radio waves, microwaves, wires, lines, coaxial cables, wave guides, fiber optics, satellite transmissions, or by any other means, directly or indirectly to viewers or listeners. (d) The property factor shall be determined in accordance with sections 235-30 to 235-32, HRS, and the rules thereunder; the payroll factor in accordance with sections 235-33 to 235-34, HRS, and the rules thereunder; and the sales factor in accordance with sections 235-35 to 235-37, HRS, and the rules thereunder; except as modified by this section. (e) The following rules relate to the property factor. (1) The following rules apply with respect to the property factor in general. (A) In the case of rented studios, the net annual rental rate shall include only the amount of the basic or flat rental charge by the studio for the use of a stage or other permanent equipment such as sound recording equipment and the like; except that additional equipment rented from other sources or from the studio not covered in the basic or flat rental charge and used for one week or longer (even though rented on a day- to-day basis) shall be included. Lump-sum net rental payments for a period which encompasses more than a single income year shall be assigned ratably over the rental period. HRS §235-38