Were tickets for scheduled train rides between tourist attractions subject to Florida sales tax as admissions or equipment rentals?

Plain-English summary

The Florida Department of Revenue concluded that tickets for the proposed train were not subject to sales tax. The charge paid for transportation, not admission to an attraction and not a rental or license to use the train.

The train would operate on a regular schedule and carry passengers between points in the system. Riders could board and leave at different locations, and a ticket did not grant admission to a museum or other facility. The operator also stated that the service offered no sightseeing, lecture, or amusement.

The transaction was not a rental of tangible personal property because passengers did not take possession of the train or direct or control its physical operation. Florida therefore treated the arrangement as a nontaxable transportation service.

What this means for you

Transportation operators

The point-to-point function mattered. The service moved passengers through a system on a regular schedule rather than selling entry to recreation or amusement.

Tourist attractions and ticket sellers

The ticket covered only the ride. It did not include admission or special admission to any connected museum or facility.

Accountants and tax professionals

Analyze both what the customer receives and who controls the equipment. Here, neither the admissions definition nor the tangible-property rental rules applied.

Common questions

Q: Was the train ticket a taxable admission?
A: No. It did not admit the passenger to a place of amusement, sport, or recreation.

Q: Did connecting tourist attractions make the ride an amusement?
A: No under the stated facts. The ticket provided transportation only, with no sightseeing, lecture, amusement, or attraction admission.

Q: Was the passenger renting the train or a seat?
A: No. The passenger did not possess or control the train's physical operation.

Q: Did the train return every passenger to the boarding point?
A: No. Passengers normally traveled from one point in the system to another.

Citations and references

• Fla. Stat. §§ 212.02(1) and 212.04 — definition and taxation of admissions
• Fla. Stat. § 212.05(1)(c) and (d) — rentals or licenses of tangible personal property
• Fla. Admin. Code r. 12A-1.005(4)(p) — trolley or train travel with disembarkation at other points
• Fla. Admin. Code r. 12A-1.071(10)(d) — passenger transportation without possession or operational control is a service, not a rental
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 96A-064

Original ruling text

Dec 23, 1996

Re: Technical Assistance Advisement 96(A)-064
Consideration Paid for Railroad Train Ride
XXXX (Taxpayer)
Sections 212.02(1), 212.04, 212.05(1)(c), and (1)(d), F.S.
Rule 12A-1.005(4)(p), 12A-1.071(10)(d), F.A.C.

Dear :

This is a response, styled a Technical Assistance Advisement, to
your letter dated September 23, 1996, wherein you ask whether
consideration paid for entrance to a railroad train is subject
to sales tax as an admission, or as a rental of tangible
personal property. You contend the charge is not subject to tax
because the consideration is paid in exchange for a
transportation service.

You state on page 2 of your letter that Taxpayer, "... has
purchased, from out of State, a diesel powered steam railroad
engine which pulls three passenger trolley type cars seating 65
passengers...." You add that this equipment is now being tested
for expected operation in XXX and that service will connect
various tourist attractions along right-of-way not owned by
Taxpayer.

You describe, also on page 2, that Taxpayer "... will issue
tickets for the privilege of riding on the train. A ticket
authorizes riding from any point in the system to any other
point in the system. Passengers are not normally returned to
the point where they board the engine and passenger car system."
You add that "... [n]o ticket authorizes any admission or
special admission to any Museum or other facility." You state
that "[t]he charge for the train ticket is for the purpose of
utilizing the transportation system alone." The train, you
reveal, will operate on a regular schedule irrespective of the
number of passengers seeking transportation. You state that
various authorized businesses sell the tickets and that such

tickets are valid only for one day. Further, you assert that
"[t]here is no `sight seeing', lecture or amusement in the
system."

As to these facts, you opine that the tickets are not sold as
admissions taxable in accordance with the provisions of s.
212.04, F.S., nor is the ticket price given in exchange for a
lease of, or license to use, tangible personal property as
interpreted in Rule 12A-1.071(1)(a), Florida Administrative
Code. You contend that the tickets are sold solely for the
purpose of providing a transportation service which is not
subject to sales tax as provided in Rule 12A-1.005(2)(p),
Florida Administrative Code.

Department Response

Section 212.05, F.S., levies sales tax on the privilege of
engaging in various activities including the furnishing of "...
any of the things or services taxable under this chapter...."
There is no provision within this statute or within Chapter 212,
F.S., for the imposition of sales or use tax on the furnishing
of transportation services. Thus, lacking such statutory basis,
transportation services are not subject to such tax. The
activity you describe is a transportation service because the
service is tendered for the act of transporting passengers from
one point to another within the transportation system provided
by Taxpayer to or from which, at any point, the passengers may
entrain or detrain.

This service is not included within the statutory definition of
"admissions" as such term is defined in s. 212.02(1), F.S.,
because the charge for the ticket is not that which is paid to
admit a person to, or for the act of entering or staying in, a
place of amusement, sport, or recreation. Rule 12A-1.005(4)(p),
F.A.C., expressly provides, as you cite in your letter, that
charges are not taxable as an admission if made for "...
trolley, or train travel where the passengers may disembark for
shopping, dining and other activities at points other than the
origination point."

Neither is the service you describe a rental of, or license to

use, tangible personal property, which is made subject to tax by
s. 212.05(1)(c) and (1)(d), Florida Statutes. As these statutes
are interpreted in Rule 12A-1.071(10)(d), F.A.C., the passenger
"... does not take possession or have any direction or control
over the physical operation, [of the train and consequently] the
contract constitutes a service transaction and not the rental of
tangible personal property, and no tax is due on the
transaction."

In sum, the charge paid by a passenger to board the train, in
accordance with the facts you provide, is not given for an
admission, nor is the consideration paid by the passenger
pursuant to a lease or license to use tangible personal
property. It is payment made for a transportation service which
is not taxable.

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,

Robert G. Parsons

Tax Law Specialist
Tax Policy and Dispute Resolution

Ctrl. No. 26589