It depends on the circumstances, for example:
- If the promoter is an entity, tax must be withheld because the entity is deemed to be doing business in North Carolina through its agent (the entertainer).
- If the promoter is an individual, tax is only required to be withheld from the payment to the promoter to the extent the promoter performed services in North Carolina.
However, the promoter is the entity required by law to withhold the tax and could be pursued by the Department of Revenue for collection if the tax is not withheld or is withheld but not remitted to the Department by the venue.
A contractual provision between the promoter and the venue shifting the responsibility to the venue is not binding on the Department since the Department is not a party to the contract.
The promoter is required to withhold from the compensation paid to the entertainer because the entertainer is providing a personal service in North Carolina for the promoter.