Were charges for carrying passengers and vehicles between two ports on an owner-operated, crewed ferry subject to Florida sales tax?

Subject

Charges Made for Transportation on a Ferry Vessel

Plain-English summary

The ferry transportation charges were not subject to Florida sales tax. The vessel would carry people and vehicles from one port to another, and the owner/operator would supply and control both the vessel and crew. The Department treated the payment as consideration for a transportation service rather than a taxable admission or rental of tangible personal property.

That conclusion did not exempt separate onboard commerce. Sales of taxable tangible personal property or meals while the vessel was dockside or in Florida waters remained subject to sales tax.

What this means for you

The ruling depended on genuine point-to-point transportation under the owner/operator's control. It distinguished the transportation fare from separate sales made aboard the vessel.

Common questions

Q: Was the ferry fare treated as a taxable admission? No. It was payment for transportation.

Q: Did carrying vehicles change the result? No. The ruling described transportation of persons or property as a nontaxable service.

Q: Were meals and goods sold onboard exempt too? No. Taxable sales made dockside or in Florida waters remained taxable.

Citations and references

• Fla. Stat. § 212.04(1)(a) — admissions
• Fla. Stat. § 212.08(7)(y) — vessel-related exemption discussed in the ruling
• Fla. Admin. Code r. 12A-1.071(16) — crewed vessel transportation service
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 93A-045

Original ruling text

Jul 21, 1993

RE: TAA 93A-045
Sales Tax; Charges Made for Transportation on a Ferry
Vessel
s. 212.04(1)(a), F.S.; s. 212.08(7)(y), F.S.
Rule 12A-1.071, F.A.C.

Dear:

This is in response to your letters of March 24, 1993 and
April 1, 1993, requesting a Technical Assistance Advisement
concerning the taxability of charges for transportation on a
ferry vessel.

Your letter of April 1, 1993, provides the following
information:

"XXXXX intends to build one or more U.S. flagged ferry vessels
that will operate between XXXXX ports, specifically, XXXX to
XXXXX. The vessel will carry automobiles, busses, and
passengers overnight between these two ports. The vessel will
be owned by a public corporation based in Florida. The crewing,
cabin management, food service, etc. will be by subcontractors.
The shoreside management will be located in XXXXX.

"The proposed fare structure will be:

Cabin

$90

Vehicle

$150

Passenger

$50

Food per specification"

Statutory Authority

Section 212.04(1)(a), Florida Statutes, provides:

"(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(7)(y), F.S., provides in part:

"(7)(y)... The charge for chartering any boat or vessel,
with the crew furnished, solely for the purpose of fishing
is exempt from the tax... This exemption does not apply to
any charge to enter or stay upon any `headboat', party
boat, or other boat or vessel...."

Regulatory Authority

Rule 12A-1.071(16), Florida Administrative Code, states 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...."

Department Response

The sales tax imposed by Part I, Chapter 212, F.S., does
not extend to charges made for the transportation of persons or
property. Such transportation is a nontaxable service.

Therefore, the payment tendered by a passenger to the
owner/operator of a ferry vessel who supplies the crew and
which, as to both the vessel and crew, are under the control and
direction of such owner/operator, which departs one port and
then lands at another, at which point the passengers are allowed
to disembark, is consideration given in exchange for the service
of transportation. Such a payment is not subject to sales tax.

Per our conversation on May 13, 1993, you advised that it
is possible that meals and items of tangible personal property
may be sold while the vessel is dockside or in Florida waters.
This is to advise you that any sales of taxable tangible

personal property or meals while in Florida waters would be
subject to sales tax consistent with TAA 89(A)-034.

This response constitutes a Technical Assistance Advisement
under s. 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 s. 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 advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response and your request
are public records under Chapter 119, F.S., which are subject to
disclosure to the public under the conditions of s. 213.22, F.S.
Your name, address, and any other details which might lead to
identification of the taxpayer must be deleted by the Department
before disclosure. In an effort to protect the confidentiality
of such information, we request you notify the undersigned in
writing within 15 days of any deletions you wish made to the
request or the response.

Sincerely,

Bonnie Everton
Technical Assistant

/e
Cont. #8112