State of Rhode Island - Division of Taxation
Sales and Use Tax
Regulation SU 87-112
A. Composition or setting of type by a typographer in such a manner that produces a camera ready proof or a hard copy that is transferred to the customer is a sale of tangible personal property. The true object sought in the transaction is the camera ready proof. The typographer in this type of transaction is a retailer and is required to register as such and collect and remit the tax. Cross Reference: "Manufacturing Property and Public Utilities Service Used In"
B. Composition or the setting of type by a typographer is not subject to the tax where title to the metal type, forms or other property constituting such type is retained by the typographer. The transaction is regarded as constituting the sale of a service and not a sale or transfer of tangible personal property.
The retention of title will be presumed when records maintained by the typographer reflect the return of type metal by issuance of credit slips or other documentation.
In such instance the typographer is a consumer and must pay the tax as measured by the cost of all materials, supplies and equipment acquired.
R. GARY CLARK
DATE: May 1, 1987