Was a crewed sport-fishing charter charged by boat and trip exempt from Florida sales tax?

Plain-English summary

Florida exempted the operator's sport-fishing charter fees from sales tax. The operator furnished the boat, captain, crew, tackle, and bait solely for fishing and charged the same flat amount per trip whether one, two, three, or four fishermen participated.

That structure qualified as a charter rather than a taxable per-person admission on a head boat or party boat. Food and drinks were not included, and the marketing did not present sightseeing or party-boat services.

What this means for you

Pricing and actual use matter. A crewed fishing-only charter charged by the boat can qualify for the exemption, while per-person admission pricing or mixed recreational services can produce a different result.

Common questions

Q: Does passenger count affect the exemption? In this ruling, the rate stayed the same regardless of passenger count, which supported exempt charter treatment.

Q: Would a per-person fishing fee receive the same result? The cited rule treats per-person head-boat or party-boat charges as taxable admissions.

Citations and references

• Fla. Stat. § 212.08(7)(y) — charter-fishing exemption
• Fla. Stat. §§ 212.02 and 212.04 — admissions
• Fla. Admin. Code r. 12A-1.005(3)(k) — boat admissions
• Fla. Admin. Code r. 12A-1.071(16)-(18) — vessel charters
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 03A-005

Original ruling text

SUMMARY

QUESTION: Is the fee collected for a sport-fishing charter
trip, in which the fee is based on the boat and time, and
not charged per person, exempt from Florida Sales Tax?

ANSWER-Based on the Facts Below: Yes. Pursuant to Section
212.08(7)(y), F.S., the sport-fishing charter is exempt
from Florida Sales Tax because it charges a flat rate per
trip, independent of the number of fisherman who actually
make the trip, and because the charter does not charge "per
person".

Jan 28, 2003

Subject: Technical Assistance Advisement 03A-005
Charter Fishing Vessels
Sales and Use Tax
Sections 212.02; 212.04; and 212.08, F.S.
Rules 12A-1.005; and 12A-1.071, F.A.C.
XXX ("Taxpayer")
FEI: XX

Dear :

This response is in reply to your letter dated December 20,
2002, requesting this Department's issuance of a Technical
Assistance Advisement ("TAA") pursuant to Section 213.22, F.S.,
and Chapter 12-11, F.A.C., regarding the referenced matter and
party. An examination of your letter has established that you
have complied with the statutory and regulatory requirements for
issuance of a TAA. Therefore, the Department is hereby granting
your request for issuance of a TAA.

ISSUE

Whether sport-fishing charters such as the one operated by
("Taxpayer") qualifies for the sales tax exemption under Section

212.08(7)(y), F.S.

FACTS

The material you provided along with your request for a TAA
provides in part:

The Taxpayer is a charter-fishing operation at the ("Resort").
The Taxpayer has two (2) boats, each with a dedicated captain
that provides fishing charters to guests of the resort. The
Taxpayer supplies the boat, crew, tackle and bait solely for the
purpose of customers chartering the boats to go sport-fishing.

Rates charged to charter a boat are per boat trip, not per
person. The rates are the same whether there are 1, 2, 3,
or 4 fishermen aboard. Food and drinks are not included in
the charter rate. Rates are broken down into the following
categories: six (6) hour trips; eight (8) hour trips; ten
(10) hour trips; twelve (12) hour trips; and a per hour
charge for trips over twelve (12) hours.

The two (2) boats available for charter are a 35 foot long
boat and a 23 foot long boat. The former boat has a
private toilet and "modest berthing." The 23 foot long
boat has neither amenity and is designed to allow entry
into creeks and coves. The Taxpayer's marketing brochure
contains the phrases "Charter Fishing" and "Sportfishing
Charters." The brochure fails to use any words that would
imply sightseeing or that the charter is a "party boat."

TAXPAYER POSITION

The Taxpayer seeks an official binding statement confirming that
it is exempt from collecting sales tax on its sport-fishing
charters.

APPLICABLE STATUTES AND RULES

Section 212.02, F.S., provides in part:

(1) The term "admissions" means and includes the net sum of

money after deduction of any federal taxes for admitting a
person or vehicle or persons to any place of amusement,
sport, or recreation or for the privilege of entering or
staying in any place of amusement, sport, or recreation,
including, but not limited to, theaters, outdoor theaters,
shows, exhibitions, games, races, or any place where charge
is made by way of sale of tickets, gate charges, seat
charges, box charges, season pass charges, cover charges,
greens fees, participation fees, entrance fees, or other
fees or receipts of anything of value measured on an
admission or entrance or length of stay or seat box
accommodations in any place where there is any exhibition,
amusement, sport, or recreation, and all dues and fees paid
to private clubs and membership clubs providing
recreational or physical fitness facilities, including, but
not limited to, golf, tennis, swimming, yachting, boating,
athletic, exercise, and fitness facilities, except physical
fitness facilities owned or operated by any hospital
licensed under chapter 395.

Section 212.04, F.S. provides in part:

(1)(a) It is hereby declared to be the legislative intent
that every person is exercising a taxable privilege who
sells or receives anything of value by way of admissions.

Section 212.08, F.S., provides in part:

(7) MISCELLANEOUS EXEMPTIONS

(y) Charter fishing vessels.--The charge for chartering any
boat or vessel, with the crew furnished, solely for the
purpose of fishing is exempt from the tax imposed under s.
212.04 or s. 212.05. This exemption does not apply to any
charge to enter or stay upon any "head-boat," party boat,
or other boat or vessel. Nothing in this paragraph shall be
construed to exempt any boat from sales or use tax upon the
purchase thereof except as provided in paragraph (t) and s.
212.05.

Rule 12A-1.005, F.A.C., provides in part:

***
(3)(k)1. When the owner of a boat or vessel operated as a
"head-boat" or "party boat" supplies the crew, which
remains under the control and direction of the owner, and
makes a charge measured on an admission or entrance or
length of stay aboard the vessel for the privilege of
participating in sightseeing, dinner cruises, sport,
recreation, or similar activities including fishing, the
charge is taxable as an admission.

2. The charge made by an owner or operator for chartering
   any boat or vessel, with a crew furnished, solely for the
   purpose of fishing is exempt.

Rule 12A-1.071, F.A.C., provides in part:

(16) When a boat or vessel is chartered with crew
furnished, for the carriage or transportation of persons or
property from one point to another and the charterer does
not have any direction or control over its operation, the
contract constitutes a service transaction and not the
rental of tangible personal property and is exempt. See
subsection (18)(c) for charter fishing vessels.

(17) When a boat or vessel is leased or rented on a "bare
boat" basis, the sales tax applies to the gross proceeds
derived from the lease or rental. The lease or rental is
considered to be on a "bare boat" basis when:

(a) The lessor does not provide a crew;

(b) The lessor does provide a crew but it is hired by the
lessee under a separate employment contract. (Under such
circumstances the employment contract cost is not a part of
the gross proceeds derived from the lease or rental and is
not taxable.)

(18)(a) When the owner of a boat or vessel operated as a
"head-boat" or "party boat" supplies the crew, which

remains under the control and direction of the owner, and
makes a charge measured on an admission or entrance or
length of stay aboard the vessel for the privilege of
participating in sightseeing, dinner cruises, sport,
recreation, or similar activities including fishing, the
charge is taxable as an admission.

(b) Example: A vessel having a capacity for 6 persons
operates as a "party" or "head-boat" with a charge of $50
per person for a day fishing trip whether 1 or 6 persons
are carried on the trip. The charge made is considered a
charge for admission and is subject to sales tax.

(c) The charge made for chartering any boat or vessel with
a crew furnished, solely for the purpose of fishing, is
exempt from the tax on admissions and from the tax on
leases or rentals of tangible personal property.

(d) Example: A vessel similar to that in the example in (b)
above is available for a day fishing trip for a charge of
$300 per day, with crew furnished, without any reduction
for the number of persons participating in the trip. This
transaction qualifies as a charter fishing trip and the
charge is not subject to sales tax.

RESPONSE

In reviewing the marketing material provided, The Taxpayer's
operation fits squarely into example "(d)." The marketing
material provides: "(These rates are per boat TRIP, not per
person)"; and "Note: These rates are the same whether there are
1, 2, 3, or 4 fishermen." ("Charter Rates 2002," emphasis in the
document).

Based on the facts and documents presented by the Taxpayer, the
charges for its charter-fishing business are exempt from sales
tax under Section 212.08(7)(y), F.S., because: (1) it charges a
flat rate per trip, independent of the number of fishermen who
actually make the trip; and (2) because it does not charge "per
person."

This response constitutes a Technical Assistance Advisement
under Section 213.22, F.S., which is binding on the Department
only under the facts and circumstances described in the request
for this advice as specified in Section 213.22, F.S. Our
response is predicated on those facts and the specific situation
summarized above. You are advised that subsequent statutory or
administrative rule changes, or judicial interpretations of the
statutes or rules, upon which this advise is based, may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response, your request and
related backup documents are public records under Chapter 119,
F.S., and are subject to disclosure to the public under the
conditions of s. 213.22, F.S. Confidential information must be
deleted before public disclosure. In an effort to protect
confidentiality, we request you provide the undersigned with an
edited copy of your request for Technical Assistance Advisement,
the backup material and this response, deleting names, addresses
and any other details which might lead to identification of the
taxpayer. Your response should be received by the Department
within 15 days of the date of this letter.

Sincerely,

Eric R. Peate
Senior Attorney
Technical Assistance and Dispute Resolution
(850) 922-4714

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Enclosure