Nev. Admin. Code § 372.130 — 372.130

NAC 372.130    Advertising agencies. ( NRS
360.090 , 372.725 )
1.  As used in this section, an “advertising
agency” is a person who is primarily in the business of furnishing advertising
and promotional services to clients.
2.  An advertising agency is the consumer of all
the tangible personal property used in the normal course of the business, such
as ink, rubber cement and other items used for the purposes of the agency.
3.  The development of primary advertising
materials on behalf of a client for delivery to the print or broadcast media, a
printer or a supplier is principally a service and the charges for such
materials are not subject to the sales tax. As used in this subsection, the
phrase “development of primary advertising materials” includes all activities
involved in the conceptualization, production and refinement of the
advertisement or public relations material before its subsequent reproduction
by a printer or supplier. The gross receipts from primary advertising materials
produced before reproduction are not subject to the sales tax regardless of
their form because the development of these materials for the specific benefit
of a particular client will be considered a service. These services may
include, without limitation, rough or comprehensive visualizations,
consultation, market analysis, writing of scripts or copy, creation of
preliminary and final artwork or photographs, typesetting, typography, or
placing or arranging for the placing of advertisements in newspapers,
magazines, publications, television, radio or other advertising media. The
sales tax does not apply to a charge billed as an agency fee, service charge or
commission if it represents a charge or part of a charge for a service that is
not subject to the sales tax.
4.  The sales tax applies to the gross
receipts from the creation of reproductions of the primary advertising
materials, whether the reproduction is performed by a printer or supplier or is
performed directly by the advertising agency.
5.  An advertising agency may act as a
purchasing agent for a customer for the acquisition of reproductions of primary
advertising materials from a printer or supplier and pay the tax at the time of
purchase from the printer or supplier if it:
(a) Obtains prior written authorization from the
customer to purchase the reproductions on his or her behalf;
(b) Discloses to the printer or supplier the name
of the customer for whom the reproductions are being purchased;
(c) Charges the customer for the reproductions an
amount not to exceed the amount paid by the advertising agency, including the
tax;
(d) Lists separately the charges to the customer
set forth in paragraph (c) on the statement to the customer; and
(e) Does not use the reproductions for itself or
any other customer.
6.  The sales tax does not apply to any
charges for:
(a) Supervision, consultation, research, postage,
express, telephone and telegraph messages, transportation and travel expenses,
or talent fees, if the charge is stated separately on the invoice or is part of
a charge for other services.
(b) Retouching to prepare artwork or photographs
for reproduction.
[Tax Comm’n, Combined Sales and Use Tax Ruling No. 51,
eff. 6-7-68]—(NAC A 11-12-93; 7-5-94)