By Zachary Atkins and Prentiss Willson

The Missouri Department of Revenue issued a letter ruling in which it determined that the sale or rental of streaming video content is not subject to Missouri sales or use tax. The service in question allowed customers to purchase or rent video content and to stream the content through devices like computers and televisions via the Internet. The Department analogized the facts to the sale of canned software delivered over the Internet, which, according to Missouri regulations, is nontaxable because the software is not delivered in a tangible medium. Likewise, in the case of streaming video content, customers do not receive tangible personal property when they purchase or rent the content, and therefore the purchase or rental is not subject to sales or use tax. Missouri Dep’t of Revenue, Letter Rul. No. 7338 (Dec. 20, 2013).