Did a lump-sum fantasy-camp package combining admission, hotel, transportation, meals, and other items qualify for Florida travel-agent vacation-package treatment?

Plain-English summary

The Florida Department of Revenue concluded that the seller did not need to collect additional sales tax on its lump-sum vacation-package price. The seller qualified as a travel agent, bought all components from other companies, paid tax on the taxable components, and did not separately price any component to the customer.

The company marketed and arranged fantasy-camp-style programs. A subcontractor operated the program and obtained facilities, personnel, and equipment. The seller also purchased airfare, hotel rooms, uniforms, ground transportation, meals, insurance, and other items for participants.

The package met the statutory conditions

Section 212.04(1)(d) and Rule 12A-1.005(6) allowed travel agents to sell a package without additional component-level tax when:

1. The package contained at least two components, such as admissions, transient rentals, transportation, or meals.
2. Every component was purchased from another party.
3. Tax due on taxable component purchases was paid.
4. The customer received one lump-sum price without separate itemization.

The seller represented that it would be licensed as required for a seller of travel and would meet those conditions.

The admission was taxed before bundling

The participant fee for attending the fantasy camp was a taxable admission. The subcontractor collected tax from the seller on the amount representing that admission, and the seller paid applicable tax to other vendors on the remaining taxable purchases.

Because tax was handled at the component-purchase stage, the seller did not collect sales tax again on the final lump sum charged to program customers.

Itemization or related-party underpricing could change the result

The rule imposed different requirements if the travel agent separately priced taxable components. It also denied the lump-sum treatment when a component came from a related corporation at less than the normal price charged to unrelated travel agents.

What this means for you

Travel agents and tour operators

Bundle at least two real travel components, buy them from third parties, pay tax where due, and charge one unitemized amount if you want the treatment approved in this ruling.

Event and experience package sellers

Participation in a sports, amusement, or recreation program can be a taxable admission even when the overall customer package is not retaxed.

Accounting and billing teams

Preserve vendor invoices showing tax paid on taxable components and ensure customer-facing receipts do not separately price the admission, hotel, transportation, meals, or other elements.

Common questions

Q: What components were included?
A: Admission, transient accommodations, air and bus transportation, meals, uniforms, equipment, insurance, and related program items.

Q: Was the fantasy-camp participant fee taxable?
A: Yes. The subcontractor collected tax from the seller on the admission amount.

Q: Did the seller tax the final package price again?
A: No. The Department approved no additional tax on the unitemized lump sum because the statutory conditions were met.

Q: Could the seller provide one component itself?
A: Not under the facts approved here. The ruling emphasized that all components were purchased from separate companies.

Q: What if the invoice separately priced the hotel or admission?
A: The travel agent would fall under the rule's itemized-package provisions and could have collection and registration duties.

Citations and references

• Fla. Stat. § 212.02(1) — definition of taxable admissions
• Fla. Stat. § 212.04(1)(b)-(d) — admissions tax and vacation-package exception to additional tax
• Fla. Stat. § 559.927(10) — seller-of-travel definition
• Fla. Admin. Code r. 12A-1.005(6) — vacation-package requirements and itemized-package treatment

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 05A-018

Original ruling text

SUMMARY
QUESTION: Whether the Taxpayer's sales qualify as vacation packages sold by a travel agent for purposes of section
212.04(1)(d), F.S.
ANSWER - Based on Facts Below: Yes. The Taxpayer will be licensed as a travel agent as required by section
559.927, F.S. The Taxpayer will satisfy all requirements of Rule 12A-1.005(6), F.A.C. The vacation packages sold will
always include multiple components including admissions, transient rental accommodations, transportation, and
meals. Each component will all be purchased from separate companies. The Taxpayer will not supply any single
component by itself. The admission component that is the fee to attend the fantasy camp will include sales tax. The
package will be billed as a single lump sum without separate pricing or itemization of the component parts.

April 7, 2005

Subject: Technical Assistance Advisement 05A-018
Vacation Packages
Sales and Use Tax
Sections 212.04, F.S., and 212.02(1), F.S.
Rule 12A-1.005, F.A.C.
XXX ("Taxpayer")
FEIN: XX
Dear:
This response is in reply to your petition requesting the Department's issuance of a Technical Assistance Advisement
pursuant to s. 213.22, F.S., and Chapter 12-11, F.A.C., regarding the above referenced matter and parties
ISSUE
Whether the Taxpayer's sales qualify as vacation packages sold by a travel agent provided for by section
212.04(1)(d), F.S.
FACTS
The Taxpayer enters into agreements with XXX organizations and XXX to market, sell, create, and implement XXX
programs using the XXX or organization's name. The Taxpayer is required to arrange for all aspects of the program.
The Taxpayer collects a lump sum from each customer participating in the XXX program.
The Taxpayer subcontracts with another company, the Subcontractor, to implement and operate the program. The
Taxpayer will provide receipts to the customers participating in the XXX program that will permit the customer to

participate in Subcontractor's XXX program.
The Subcontractor rents the necessary facilities and obtains the services of XXX and certified XXX. The
Subcontractor also purchases the equipment, personnel, and professional XXX. All personnel used to operate the
program for the Subcontractor are independent contractors. A license fee is paid by the Taxpayer to the respective
XXX for the use of its trademarks and service marks.
All facilities utilized in the events are rented by the Subcontractor either from XXX, or from the city or county that owns
the facility. The Taxpayer does not own any facility at which programs are conducted.
Taxpayer will also purchase for the customers other items, such as air transportation, hotel accommodations, uniforms
(includes shirts, pants, belts, socks, caps, jackets), equipment, bus transportation (from the airport and to the program
venue), food (including breakfast, lunch, and dinners), insurance, etc. The Subcontractor will collect sales tax from the
Taxpayer on all income received that represents the participant or admissions fee amount paid. The Taxpayer pays all
other vendors the appropriate sales tax for the taxable components.
APPLICABLE STATUTES AND RULES
Section 212.02(1), F.S., provides:
(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(1), 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.
(b) For the exercise of such privilege, a tax is levied at the rate of 6 percent of sales price, or the actual value received
from such admissions, which 6 percent shall be added to and collected with all such admissions from the purchaser
thereof, and such tax shall be paid for the exercise of the privilege as defined in the preceding paragraph....
(c) The provisions of this chapter that authorize a tax-exempt sale for resale do not apply to sales of admissions.
However, if a purchaser of an admission subsequently resells the admission for more than the amount paid, the

purchaser shall collect tax on the full sales price and may take credit for the amount of tax previously paid. If the
purchaser of the admission subsequently resells it for an amount equal to or less than the amount paid, the purchaser
shall not collect any additional tax, nor shall the purchaser be allowed to take credit for the amount of tax previously
paid.
(d) No additional tax is due on components incorporated as part of a package sold by a travel agent if the package
includes two or more components such as admissions, transient rentals, transportation, or meals; if all of the
components were purchased by the travel agent from other parties and any sales tax due on such purchases was
paid; and if there is no separate itemization of the admission, transient rental, transportation, meal, or other
components in the sales price of the package. This paragraph does not apply if the actual price charged for a
component by the dealer to a travel agent is less than the price charged to unrelated parties under normal industry
practices and the dealer and the travel agent are members of the same controlled group of corporations for federal
income tax purposes.
Section 559.927(10), F.S., provides:
(10) "Seller of travel" means any resident or nonresident person, firm, corporation, or business entity who offers for
sale, directly or indirectly, at wholesale or retail, prearranged travel, tourist-related services, or tour-guide services for
individuals or groups, including, but not limited to, vacation or tour packages, or vacation certificates in exchange for a
fee, commission, or other valuable consideration. The term includes any business entity offering membership in a
travel club or travel services for an advance fee or payment, even if no travel contracts or certificates or vacation or
tour packages are sold by the business entity.
Rule 12A-1.005, F.A.C., provides in part:
(1)(a) Every person is exercising a taxable privilege when such person sells or receives anything of value by way of
admissions, as defined in s. 212.02(1), F.S., except those admissions that are specifically exempt. Such seller is
required to collect on each admission charge for 10 cents or more the amount of tax provided for by the applicable
bracket provided in s. 212.12(9), F.S. Each admission is a single sale....
(6) SALES OF VACATION PACKAGES.
(a) For purposes of this subsection, a "vacation package" means a bundle consisting of two or more components,
such as admissions, transient rentals, transportation, or meals. Coupon books, maps, or other incidental items, that
are provided free of charge as part of a vacation package are not considered "components" for purposes of this
subsection.
(b) Tax is due on the purchase of taxable components of a vacation package at the time of purchase. No additional
tax is due on the components that are incorporated into a vacation package and sold by a travel agent, when all of the
following conditions are met:

1. The vacation package sold by the travel agent includes two or more components;

2. There is no separate itemization of the sales price of the package for the admission, transient rental, transportation,
meal, or any other component of the vacation package; and

3. All components of the vacation package were purchased by the travel agent from other parties and any sales tax
   due on such purchases was paid at the time of purchase.
   (c) A travel agent who itemizes the sales price of the taxable components of a vacation package must register with the
   Department as a dealer. (See Rule 12A-1.060, F.A.C., Registration). Travel agents who itemize the sales price of the
   taxable components of a vacation package are required to collect tax from the purchaser as follows:
4. When the itemized components are sold for the same amount or less than was paid for each of them, the travel
   agent is not required to collect any additional tax. No credit is allowed for tax paid on the purchase of the taxable
   components.
5. When the itemized components are sold for more than the purchase price of each component, the travel agent is
   required to collect tax on the sales price of the taxable components. The travel agent may take a credit of tax
   previously paid for the taxable components that are separately itemized at a sales price greater than the purchase
   price of the component.
   (d) When the seller of components of a vacation package and the purchasing travel agent are members of the same
   controlled group of corporations for federal income tax purposes and the amount charged for the component is an
   amount less than the price charged to unrelated travel agents under normal industry practices, the related travel agent
   is required to itemize the sales price of the components to the purchaser and collect tax on the itemized taxable
   components. The travel agent may take a credit of tax previously paid for the taxable components.
   DISCUSSION
   As provided by section 212.02(1), F.S., admissions include charges for participation fees paid to enter or stay in a
   place of sport or amusement, as in this instance. Section 212.04(1)(b), F.S., imposes the tax on the sales price or
   amount received by way of sales of admissions. Section 212.04(1)(c), F.S., provides that the tax must be collected on
   each sale of admission, including admissions sold for resale. Section 212.04(1)(d), F.S., provides an exclusion from
   the provisions of section 212.04(1)(c), F.S., when the admissions are sold as part of certain vacation packages sold in
   a lump sum amount by travel agents. Travel agents are required to pay the tax on the purchase of the elements
   included in the package that are subject to sales tax.
   Although "Travel agent" is not defined by statute, section 559.927(10), F.S., includes many types of companies as
   "sellers of travel" that are regulated by Chapter 559, F.S. So long as the Taxpayer complies with the provisions of
   Chapter 559, F.S., and all other provisions of section 212.04(1)(d), F.S., are satisfied, then the Taxpayer may be
   considered a travel agent for purposes of section 212.04(1)(d), F.S.
   In order to qualify for treatment under Section 212.04(1)(d), F.S., and Rule 12A-1.005(6), F.A.C., a vacation package
   must meet several criteria. First, the vacation package must include multiple components, such as admissions,

transient rental accommodations, transportation, and meals. Second, all of the components must be provided by
vendors other than the "travel agent," and sales tax must have been paid on the purchase price of all taxable
components. Third, the vacation package must be priced and billed as a single lump sum; there can be no separate
pricing and itemization of the component parts of the vacation package. Finally, if any of the components of the
vacation package were purchased from a related entity, the price paid for those components must be equal to the
price paid by unrelated travel agents for the components under normal industry practices. If these criteria are met, the
sale of the vacation package by a travel agency is not subject to additional sales tax under Rule 12A-1.005(6), F.A.C.
RESPONSE
Based on the information provided, the Taxpayer is selling vacation packages that satisfy the requirements of Rule
12A-1.005(6), F.A.C., and section 212.04(1)(d), F.S. This includes the amounts charged to the Taxpayer by
Subcontractor on income received. This income is considered a taxable admission because Taxpayer's customers are
paying participant fees to attend XXX as a participant, which is subject to the sales tax on admissions, pursuant to
section 212.04, F.S. In addition, the Taxpayer is paying the sales tax on all other purchases subject to the sales tax.
As such, the Taxpayer is not required to collect the sales tax on the lump sum charge collected from the XXX program
customers.
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 advisement 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,
Charles Wallace
Senior Attorney
Technical Assistance and Dispute Resolution
(850) 922-4734
CW/
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