Photographer's supply of finished photographs treated as sale of goods, not mere work and labour, for sales tax purposes.

The true substance of the transaction determines its character: where a professional photographer takes photographs, develops negatives and supplies printed copies for a price, the arrangement is treated as a sale of goods rather than a contract for work and labour. Skill, labour and material do not change the legal nature of the transaction when the end product is a finished chattel supplied to the customer. Applying this test, the commercial production and supply of photographs was held to fall within sales tax law, and sales tax liability attached.

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Issues: Whether the activity of a professional photographer in taking photographs, developing negatives and supplying printed copies to customers amounts to a sale of goods liable to sales tax, or merely a contract for work and labour.

Analysis: The decisive test is the true substance of the transaction. Where the arrangement is directed to the production and supply of finished articles for a price, and the exercise of skill is only incidental to that result, the contract is one for sale of goods. The professional photographer's business was held to be commercial production of photographs for customers, not a purely artistic or personal service. The fact that skill, labour and some material are involved does not alter the character of the transaction if the end product supplied is a chattel sold to the customer. Authorities dealing with dispensing chemists and photographers were treated as supporting this approach.

Conclusion: The supply of photographs in the circumstances described is a sale of goods within the meaning of the sales tax law, and the petitioner is liable to pay sales tax.

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