Are receipts from branded 'mind body' fitness classes (yoga-based but marketed for toning) subject to New York City sales tax?

Plain-English summary

The Petitioner runs several New York City facilities offering yoga and a range of branded "mind body" classes. All the classes include meditation, savasana, and breathing components; some use props (ballet barre, stretch bands, yoga blocks, small balls, light hand weights). The Petitioner asked whether its receipts from the mind body classes are subject to New York City sales tax.

The Office of Counsel concluded the facilities are NYC-taxable gyms/health salons, so all their receipts are subject to NYC sales tax:

• State doesn't tax the instruction. New York State sales tax does not apply to these class fees -- instruction isn't an enumerated taxable service under Tax Law 1105(c).
• But NYC can tax health-salon/gym services. NYC is authorized (Tax Law 1212-A(a)(2)) and does impose tax (Admin. Code 11-2002) on services of "weight control salons, health salons, gymnasiums... and similar establishments" and charges for the use of such facilities.
• The test is "bodily appearance" vs. "participatory sports." The tax applies to establishments that "provide activities directed at the improvement of bodily appearance," not those offering participatory sports (e.g., swimming, racquetball) (Prospect Park Health and Racquet; TB-ST-329).
• Yoga-only would be different. A facility offering only yoga is not a taxable gym/health salon (TB-ST-329; NYT-G-12(1)).
• These classes cross the line. The Petitioner's mind body classes are advertised as increasing stamina, building strength, giving "chiseled abs and toned legs," and sculpting/toning the whole body -- i.e., directed at improving bodily appearance. So if the facility doesn't otherwise offer participatory sports, it's a weight control salon/gymnasium, and all its receipts there are subject to NYC sales tax.

What this means for you

NYC fitness studios

Even though New York State doesn't tax fitness instruction, New York City taxes the services of gyms, health salons, and weight-control salons. If your studio's classes are marketed to tone, sculpt, build strength, or improve appearance, you likely fall in the taxable category -- and then everything you sell at that location is subject to NYC sales tax, not just the appearance-focused classes.

Yoga-only is a genuine carve-out -- but marketing can blow it

A pure yoga studio isn't a taxable gym. But if you brand and advertise classes for "chiseled abs," "toned legs," and body sculpting, the Department will treat you as a gym/health salon. Your own marketing language can decide the question.

Watch the "participatory sports" distinction

Facilities centered on participatory sports (swimming, racquetball, etc.) aren't health salons. If you offer those, your classification may differ -- but appearance-focused class studios generally don't qualify for that exception.

Common questions

Q: Does New York State tax my yoga/fitness class fees?
A: No. Instruction isn't a State-enumerated taxable service. The issue here is the separate New York City tax.

Q: Why are my "mind body" classes taxable in NYC when yoga-only studios aren't?
A: Because they're marketed to improve bodily appearance (toning, sculpting, strength), which makes the facility a taxable gym/health salon under NYC law.

Q: If my facility is taxable, is it just those classes that are taxed?
A: No -- once the facility is a taxable gym/health salon, all of its receipts at that location are subject to NYC sales tax.

Citations and references

• Tax Law section 1105(c) (enumerated taxable services)
• Tax Law section 1212-A(a)(2) (NYC authority to tax health salon/gymnasium services)
• New York City Administrative Code section 11-2002 (NYC tax on weight control/health salons, gymnasiums)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2014.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a14_18s.pdf

Original ruling text

New York State Department of Taxation and Finance
TSB-A-14(18)S
Sales Tax
July 9, 2014

Office of Counsel
Advisory Opinion Unit
STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S121106A

The Department of Taxation and Finance received a Petition for Advisory Opinion from
REDACTION REDACTION REDACTION REDACTION REDACTION. Petitioner asks whether its
receipts from what it terms “mind body” classes given at facilities located in New York City are
subject to the local sales tax imposed by New York City.
We conclude that Petitioner’s New York City facilities are in the category of “weight control
salons, health salons, gymnasiums or similar facilities” for the purposes of § 11-2002(a) of the
Administrative Code of the City of New York (Administrative Code). Therefore, all of Petitioner’s
receipts from the services offered at these locations, including yoga and other mind body classes
provided at these facilities, are subject to New York City sales tax.
Facts
Petitioner operates several facilities in New York City. These facilities provide instruction in
yoga as well as a variety of classes that are included as part of a general “mind body” category. All of
Petitioner’s mind body classes, including yoga, have a meditation, savasana, and breathing component
to them. These elements are mandatory program components of each of the branded proprietary mind
body classes, and there is oversight and training to ensure the consistent instruction and delivery of
these elements in every class. Some of the mind body classes include components supported by body
movement props such as a ballet barre, stretch bands, yoga blocks, small rubber core balls, or small
hand held rubber coated weights.
Analysis
New York State does not impose sales tax on fees from the classes offered by Petitioner
because instruction in these types of classes is not one of the services subject to sales tax in Tax Law §
1105(c) of the Tax Law. However, New York City is authorized by Tax Law § 1212-A(a)(2) to enact
a local law imposing sales tax on:
the receipts from every sale of the following services: beauty, barbering, hair restoring,
manicuring, pedicuring, electrolysis, massage services, and similar services, and every sale of
services by weight control salons, health salons, gymnasiums, turkish and sauna baths and
similar establishments and every charge for the use of such facilities, whether or not any
tangible personal property is transferred in conjunction therewith [emphasis added].
New York City imposes local sales tax pursuant to this authority in Administrative Code §
11-2002. Subdivision (a) provides, in part:

-2-

TSB-A-14(18)S
Sales Tax
July 9, 2014

There are hereby imposed and there shall be paid sales taxes at the rate of four and onehalf percent on receipts from . . . every sale of services by weight control salons, health salons,
gymnasiums, turkish and sauna bath and similar establishments and every charge for the use of
such facilities, whether or not any tangible personal property is transferred in conjunction
therewith; . . . .
In order to determine whether the receipts from Petitioner’s mind body classes are subject to
New York City sales tax, we must consider the type of facilities Petitioner operates. If Petitioner’s
facilities are weight control salons, health salons, gymnasiums or similar establishments, all of
Petitioner’s charges at these facilities are subject to New York City sales tax. The Tax Appeals
Tribunal has determined that the tax applies to establishments that “provide activities directed at the
improvement of bodily appearance and not those which offer participatory sports and athletic
facilities.” See Matter of Prospect Park Health and Racquet Associates, Tax Appeals Tribunal, July
22, 1997; Health and Fitness Clubs, TB-ST-329, July 24, 2012. Some examples of participatory sports
are swimming and racquetball.
If Petitioner’s services at its facilities consisted solely of classes teaching yoga, those facilities
would not be considered weight control salons or similar facilities for New York City sales tax
purposes because a yoga-only facility is not considered to be a weight control salon, gymnasium, or
similar facility. See TB-ST-329, supra, and Application of State and Local Sales Tax to Facilities that
Provide Yoga Instruction, NYT-G-12(1), July 24, 2012. While Petitioner’s mind body classes
incorporate elements of yoga (meditation, savasana, and breathing), classes are advertised in a
brochure found on Petitioner’s website as increasing stamina and building strength, providing chiseled
abs and toned legs or sculpting or toning the participant’s entire body. It appears that the purpose of
Petitioner’s mind body classes is to improve bodily appearance. If the facilities in which these classes
are given do not otherwise offer participatory sporting activities, those facilities would be considered
to be weight control salons, gymnasiums or similar facilities for purposes of the New York City sales
tax, and all Petitioner’s receipts from those facilities would be subject to New York City sales tax.

DATED: July 9, 2014

NOTE:

/S/
DEBORAH R. LIEBMAN
Deputy Counsel

An Advisory Opinion is issued at the request of a person or entity. It is limited to the facts
set forth therein and is binding on the Department only with respect to the person or entity
to whom it is issued and only if the person or entity fully and accurately describes all
relevant facts. An Advisory Opinion is based on the law, regulations, and Department
policies in effect as of the date the Opinion is issued or for the specific time period at issue
in the Opinion. The information provided in this document does not cover every situation
and is not intended to replace the law or change its meaning.