(dissenting). I respectfully dissent.
*376In Matter of Condé Nast Publs. v State Tax Commn. (51 AD2d 17, mot to dismiss appeal granted 39 NY2d 942), this court decided the precise issue before us, i.e., that under the provisions of Tax Law § 210 (3) (a) (2) (former [D]) petitioner’s receipts from magazine advertising contracts which were negotiated and handled in New York are totally New York receipts because they constitute business receipts earned within the State. Petitioner’s contention that Condé Nast is no longer applicable should be rejected. That contention is based on respondent’s promulgation in 1978 of 20 NYCRR 4-4.3 (former [d]) (2) (renum 20 NYCRR 4-4.3 [f] [2]) classifying receipts from sales of advertising by radio and television broadcasters as receipts from "services” and thus taxable at the ultimate destination rather than at the source. The ruling is retroactive to all open years and includes the years of the instant audit. Essentially, petitioner contends that there is no distinction between print and broadcast advertising and thus there is no rational basis to continue to follow the Condé Nast formula for receipts from print advertising and 20 NYCRR 4-4.3 (f) (2) for receipts from radio and television advertising. Petitioner also argues that this disparate treatment violates its Federal constitutional guarantee of equal protection and impinges upon its 1st Amendment rights to free speech and freedom of the press. Finally, petitioner asserts that the Legislature, by its amendment in 1981 (L 1981, ch 103, § 1) of Tax Law § 210 (3) (a) (2) (B) has indicated its intent to include advertising as a "service” and thus make it taxable where rendered. As this last argument is being interposed for the first time on appeal, it is not properly before us (see, Matter of Carrazza Buick [C. Richard Ferris, Inc. — Catherwood] 20 AD2d 613, 614).
It is settled law that the construction given statutes and regulations by an agency responsible for their administration, if not irrational or unreasonable, should be upheld (e.g., Matter of Condé Nast Publs. v State Tax Commn., supra). Petitioner bears the burden of proof that the interpretation is arbitrary and unreasonable.
Dealing differently with receipts from radio and television advertising as opposed to print media does not constitute unequal treatment of petitioner under the Constitution. The applicable standard of review to such a challenge is a rational basis test. Petitioner bears the burden of proving that "the difference in treatment is 'palpably arbitrary’ or amounts to an 'invidious discrimination’ ” (see, Trump v Chu, 65 NY2d *37720, 25). In support of its contention, petitioner urges that the content of advertisement in print media is substantially the same as those in radio and television advertising. Accepting that premise as true, there are nevertheless other differences between printed media and broadcast media (see, Matter of New Yorker Mag. v Gerosa, 3 NY2d 362, 369, appeal dismissed 356 US 339). States have considerable leeway in drawing distinctions between businesses and in assessing reasonable systems of taxation (see, Matter of Long Is. Light. Co. v State Tax Commn., 45 NY2d 529). With these concepts in mind, the imposition of the tax here is not arbitrary, irrational or unreasonable. The formula utilized in allocating advertising receipts to where contracts are negotiated is the norm for all types of businesses rather than the exception in taxation statutes. There are also obvious practical distinctions between print and broadcast media which justify differences in taxation treatment. Petitioner is not being treated differently than others likewise situated nor has there been a suspect category created by the tax treatment accorded print media.
Petitioner’s argument that the interpretation of Tax Law § 210 (3) (a) (2) abridges freedom of the press is also without substance. Petitioner contends that the Tax Law singles out print media from other media improperly. The formula used in allocating advertising receipts was uniformly applied to all distributors of advertising. The advent in 1978 of 20 NYCRR 4-4.3 (f) (2) and its singling out broadcast media is justified by the uniqueness of that industry (see, Erie Communications v City of Erie, 853 F2d 1084, 1089, n 9).
Furthermore, the tax classification has not been drawn so as to impinge on petitioner’s freedom of speech. Rather, petitioner’s advertisers may be affected in that print advertising may carry costs not borne by broadcast advertisers, so that if there is any effect on petitioner, it is an economic one rather than one bearing on freedom of speech. The tax classification created is not arbitrary or irrational and should be sustained. Accordingly, I would confirm respondent’s determination and dismiss the petition.
Mahoney, P. J., Yesawich, Jr., and Harvey, JJ., concur with Kane, J.; Mikoll, J., dissents and votes to confirm in a separate opinion.
Determination annulled, with costs, petition granted and matter remitted to respondent for further proceedings not inconsistent with this court’s decision.