West Virginia: Streaming Services Subject to Sales and Use Tax

The West Virginia State Tax Department recently clarified that sales of streaming services are subject to the state’s sales and use tax. Under West Virginia law, all sales of services are subject to sales and use tax unless there is a specific exception or exemption. There is no exemption for streaming services. Streaming service providers, the guidance notes, are generally suppliers of entertainment or other content delivered electronically, usually by the internet, satellite, or cable connection to a subscriber’s device. The guidance then specifically differentiates between streaming services and sales of digital products, which are not subject to West Virginia sales and use tax. A digital product is a discrete identifiable item (e.g., the purchase or lease of a digital movie), whereas the purchase of streaming services provides a consumer purchasing access to curated entertainment content in the streaming service’s catalog, but has not procured a right to any specified digital product.

The West Virginia Department of Revenue has updated its SSUTA taxability matrix dated August 2, 2021 to reflect that while subscription services that provide digital content for permanent use (like a purchase) or less than permanent use (like a rental) are not subject to sales tax, streaming services are subject to the tax. Please contact Mark Balistrieri with questions on TSD-445 issued September 1, 2021.