Holiday Goods and Services
ready to eat is taxable. A smoked turkey or ham not kept hot is taxable only if sold with eating utensils. A charge to a customer to smoke a turkey or ham owned by the customer is not taxable.
Prepared Holiday Meals: A complete holiday meal (ex. turkey with all the trimmings) sold hot and ready to eat is taxable. If meal needs further preparation or heating, it is not taxable.
Firewood: The sale of firewood, charges for stacking wood after a tree has been cut and charges to remove a tree or debris are taxable. Chopping down a tree or cutting up a fallen tree is taxable real property service.
Gift Wrapping: When a store sold a taxable item and also wraps it for the customer, the gift wrapping charge is taxable. Gift wrapping is not taxable when an item is purchased at one store and the customer takes it to another place to be wrapped.
Layaways: A handling, cancellation and restocking fee charged by a retailer is not subject to sales tax.
Facility Rentals: Renting a hall, ballroom, pavilion, patio or similar facility for holding a party, banquet or other event is not taxable if:
• The facility is not located in a building that has sleeping accommodations.
• The rental is not connected to the sale of a taxable item such as prepared food.
• The rental does not include or constitute access to an amusement service.
Facility Rentals When Food or Amusement Services are Provided: Renting a hall or similar facility that is not located in a building that has sleeping accommodations is subject to sales tax if the rental is connected to the sale of prepared food or an amusement service.
If food is prepared and served or provided by the facility hosting the even, sales tax is due on the entire charge, including entertainment, decorations, linens, parking, security or transportation.
Sales of amusement services are subject to sales tax, including admissions to live or recorded performances, spectator sports, participatory sports and games, party boat excursions and similar activities. Also includes facility rentals allowing access to amusements such as swimming pool, skating rink, or field.
Facility Rentals in a Building with Sleeping Accommodations: Hotel occupancy tax is due when renting a room in a building that has sleeping accommodations even if the venue serves food or provides access to an amusement service with the room rental. When a third-party caterer rents a hotel banquet room for a client’s event, the caterer must pay hotel tax on the room rental and cannot issue a resale certificate. Sales tax is due on the entire amount charged to the caterer’s client, including a charge by the caterer for reimbursement of hotel tax.
Furniture and Equipment Rentals: The rental of tangible personal property for the lease (ex. tables and chairs) is subject to sales tax. When a contract for the lease or rental of nontaxable real property includes the lease or rental of furniture or equipment, no sales tax is due on the amount harged to the tenant for the lease or rental of the tangible personal property. Sales tax is due at the time such tangible personal property is acquired by the owner or manager of the real estate.
Cleaning Charges: Cleaning and janitorial services are taxable. A cleaning fee charged in connection with the rental or lease of a party room or other facility, other than a hotel, is subject to sales tax. A charge by a hotel to clean a room is charge to clean and ready a room for occupancy and hotel tax is due.
Set-Up Fees: Sales tax is due on a set-up fee charged in connection with the sale of prepared food. For bar set-up fees, the mixed beverage permittee owes mixed beverage gross receipts tax on the fee.
Bartender and Corkage Fees: Fees for bartending and corkage are subject to sales tax or mixed beverage gross receipts tax depending on the type of alcohol permit held by the person providing the alcoholic beverages. If provider has a wine and beer permit, then sales tax is due. If provider has a mixed beverage permit, the provider owes mixed beverage tax.
Service Charges and Gratuities: Voluntary tip or gratuity is not taxable. Mandatory gratuity or service charge may or may not be taxable. Mandatory gratuity is not taxable when clearly identified, is no more than 20 percent of the sale price and is disbursed to qualified employees.
Entertainment/DJ: A fee charged by a singer, band, clown, DJ or similar entertainer is to perform at an event is not taxable. A fee charged for admission to the event is taxable.
Limousines and Shuttles: Charges for limousine or shuttle service are not taxable if primary purpose is to provide transportation from one location to another. Limousine rental is taxable if the primary intent is to provide a tour of points of interest. A lump sum charge for a package including banquet facility rental with food and limousine service is taxable.