Ruling 91-21

Sales and Use Tax
Telecommunications Service

FACTS:

1.  A corporation engaged in business as a long-distance carrier and subsidiaries thereof [hereinafter collectively referred to as "the Company"] provide a telecommunications service known as "900 Commercial Service"
2. The Company has not submitted any of its contracts with the businesses [hereinafter referred to as "900 Sponsors"] for which 900 Commercial Service is designed, but characterizes this service as enabling a 900 Sponsor to offer its goods and services for a fee to telephone callers [hereinafter referred to as "end users"] calling the 900 number assigned to the 900 Sponsor by the Company.

The Company further characterizes its contractual obligations as follows:

• The Company is required to bill and collect from an end user purchasing goods or services from a 900 Sponsor the fee established by the 900 Sponsor for placing a call to the 900 number. (If the end user has not chosen the Company as his or her long-distance carrier, the Company provides the Local Exchange Carrier with the billing information, and the Local Exchange Carrier collects the fee from the end user.)
For an aggregate charge that is either a flat charge for placing a call, or a charge based on the duration of a call, to the 900 number, the Company is providing (i) telecommunications service to the 900 Sponsor and (ii) billing and collection service to the 900 Sponsor.
• The Company will pay over to the 900 Sponsor the amounts collected, offset by (i) the amount due to the Company for telecommunications service; (ii) the amount due to the Company for billing and collection service; and (iii) an amount estimated to equal the uncollected amount billed end users.

The Company will contract with 900 Sponsors that conduct opinion polls [hereinafter referred to as Product 1]. By calling a selected 900 number, a Product 1 end user will be able to vote without speaking. The fee established by 900 Sponsors will be a flat charge for making the call. Some 900 Sponsors will conduct opinion polls for end users with touch-tone telephones, who, by touching appropriate numbers on the telephone touch-pad, will be able to answer specific questions.

1.  The Company will contract with 900 Sponsors that provide a recorded message service [hereinafter referred to as Product 2]. By calling a selected 900 number, a Product 2 end user will be able to listen to a prerecorded message. The fee established by 900 Sponsors will be either a flat charge for making the call or a variable charge based on the duration of the call.

2. The Company will contract with 900 Sponsors that provide financial or other information [hereinafter referred to as Product 3] to end users with touch-tone telephones. By calling a selected 900 number and by entering a personal identification number, a Product 3 end user will be able to gain access to various data files by touching appropriate numbers on the telephone touch-pad. The fee established by 900 Sponsors will be either a flat charge for making the call or a variable charge based on the duration of the call.

3. The Company will contract with 900 Sponsors that provide interactive conversation [hereinafter referred to as Product 4]. By calling a selected 900 number, a Product 4 end user will be able to converse with one person, or with a number of other end users. The fee established by 900 Sponsors will be a variable charge based on the duration of the call.

4. The Company will contract with 900 Sponsors that solicit donations thereto [hereinafter referred to as Product 5]. Some of the 900 Sponsors may be organizations described in 26 U.S.C. §501(c)(3). By calling a selected 900 number, a Product 5 end user will be able to pledge a specific amount. Some 900 Sponsors will play a prerecorded message thanking Product 5 end users for their pledge. The fee established by 900 Sponsors will be a flat charge that equals the amount of the pledge.

5. The Company will contract with 900 Sponsors that sell tangible personal property [hereinafter referred to as Product 6]. By calling a selected 900 number, a Product 6 end user will be able to purchase particular goods. The fee established by 900 Sponsors will be a flat charge that equals the purchase price of the goods.

6. The Company's 900 Commercial Service is provided on an interstate basis pursuant to a tariff on file with the Federal Communications Commission and on an intrastate basis pursuant to a tariff on file with the Department of Public Utility Control, State of Connecticut. Rates for the Company's 900 Commercial Service are established in those tariffs.