In this five-part series, we will discuss the application of sales tax to popular summer destinations and activities, first up – sales tax at amusement parks.
Introduction
School’s out, so it’s time to hit the road (or skies, or whatever…just get there)! Summer is a time when many people travel and visit places like amusement parks, museums, and other destinations. As with other business activities, the operators of these venues need to be aware of their tax obligations (and it helps the Griswolds better plan the vacation budget).
Part 1 – Sales Tax at Amusement Parks
Sales Tax on Admissions
Sales tax applies to admissions to amusement parks in many states, although not all. For example, Florida and Idaho impose sales tax on admissions to amusement parks, while California does not. North Carolina has a special carve-out from its taxability of admissions, stating that amusement rides such as waterslides and rollercoasters are considered amounts paid for the right to participate, making them not taxable.
Ancillary Sales and Vacation Packages
Even in jurisdictions where tax does not apply to the sale of admissions to amusement parks, ancillary sales related to the overall trip, including lodging, food, and rentals of equipment, may be taxable under separate criteria. The methods for determining the taxability of these products when packaged together vary by jurisdiction. Tax on vacation packages may apply to the entire charge based on the presence of a taxable item or a majority of such items, or the tax may be apportionable. An important factor in how these determinations are made is how they are invoiced; what is and isn’t taxable can depend on whether the components of a transaction are listed separately or as a single item.
Conclusion
Planning a summer trip to an amusement park? Don’t let sales tax complexities spoil your fun. Clarus Partners can help you navigate these issues to ensure a smooth and enjoyable vacation. Contact us today for expert guidance on managing sales tax at your summer destinations. Stay tuned for part two of this series, where we will discuss national parks. Till then, say hello to Mickey and enjoy your vacation!
Summer Travel Series 2024