Advertising
You owe tax on advertising if:
You are in the business of selling "local advertising" within the
city. This tax is paid on the advertising income of persons in such businesses
as billboards, direct mail, radio, television, etc. The commissions and fees
retained by an advertising agency are not part of the taxable income.
Tax rate on advertising
The tax rate is 1.75% of the gross income from "local advertising."
(Note: The Mesa City Tax rate
increased to 1.75% effective 07/01/2006)
Collection of Tax
You may choose to charge the tax separately on each sale, or include Transaction Privilege Tax
in your price. If you over charge any tax to your customers, you must remit the
excess tax to the city.
If your price includes Transaction Privilege Tax, you can compute how much of the total price is
Transaction Privilege Tax. You may deduct the Transaction Privilege Taxes from your gross receipts.
What is "local advertising"?
Local advertising is the advertising of products, services,
and activities with a presence within the state. For more information go
to Local Advertising vs. National Advertising.
When is an advertising business operating "within the
city"
Businesses are generally considered to be doing business in the City if a major
portion of their dissemination facilities are located in the City. A
broadcasting studio located in the City is an example.
Outdoor advertising such as billboards is taxable based on the city in which the
billboard is located.
Advertising income from newspapers and periodicals is taxable as part of the tax
on "publishing."
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