Are a health and fitness club's membership fees subject to New York City local sales tax?

Plain-English summary

A national health and wellness company operates a New York City fitness facility (with cardio and strength machines, free weights, training and stretching areas, workout workshops, online weight-loss programs, plus swimming pools and basketball courts) and plans more. A membership lets users access all its NYC locations. It asked whether its charges are subject to NYC local sales tax.

The Office of Counsel concluded the charges are subject to NYC local sales tax. NYC Administrative Code § 11-2002(a) taxes receipts from "weight control salons, health salons, gymnasiums, Turkish and sauna baths and similar establishments," and a facility geared toward improving health and bodily appearance is a gymnasium/health salon. The pool and basketball court don't change that: although a participatory-sports exemption once applied (per the Prospect Park Tribunal decision), a 2008 amendment expressly removed it (§ 11-2001(a)(3)), so facilities with participatory sports are no longer exempt.

What this means for you

Gyms, health clubs, and fitness studios in NYC

Your membership and usage charges are subject to New York City local sales tax as a health salon/gymnasium. Adding pools, courts, or other participatory-sports facilities does not exempt you.

Members

Expect NYC local sales tax on gym memberships and usage fees.

Accountants and tax professionals

This is a NYC local tax under § 11-2002(a), distinct from the State enumerated services. Note the post-2008 landscape: the participatory-sports exemption that Prospect Park relied on was repealed by § 11-2001(a)(3), so cases predating 2008 no longer control.

Common questions

Q: Does the pool or basketball court exempt the club?
A: No. The 2008 amendment removed the participatory-sports exemption.

Q: Is this State or City tax?
A: This opinion concerns New York City local sales tax on health salons/gymnasiums.

Q: What kinds of facilities are covered?
A: Weight control salons, health salons, gymnasiums, Turkish/sauna baths, and similar establishments directed at improving health or bodily appearance.

Q: Can I rely on this opinion?
A: It binds the Department only as to the petitioner. Use it as guidance and confirm your own facts.

Citations and references

Statutes and guidance:
- Tax Law § 1212-A(a)(2); NYC Admin. Code § 11-2002(a); § 11-2001(a)(3)
- Matter of Prospect Park Health and Racquet Associates (Tax Appeals Tribunal, July 22, 1997)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales-ao-2020.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a20-25s.pdf

Original ruling text

New York State Department of Taxation and Finance
Office of Counsel

TSB-A-20(25)S
Sales Tax
November 3, 2020

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION
The Department of Taxation and Finance received a Petition for an Advisory Opinion
from [ REDACTED ] [hereinafter “Petitioner”] of [ REDACTED ]. Petitioner asks whether its
receipts from services provided at its health and fitness facilities are subject to New York City
sales tax. We conclude that Petitioner’s services are subject to New York City local sales tax.
Facts
Petitioner operates a national health and wellness business. Petitioner has one New York
City facility and anticipates opening additional New York City locations. Petitioner’s facilities
offer cardio machines, strength machines, free weights, training areas, stretching areas, workout
workshops and online weight loss programs. The current New York City location has swimming
pools and basketball courts, and two of the anticipated facilities also will have swimming pools.
A membership to any New York City location will allow access to all of Petitioner’s facilities in
the New York City area.
Analysis
Tax Law § 1212-A(a)(2) authorizes New York City to impose certain local taxes, and
Administrative Code § 11-2002(a) specifically imposes a local sales tax on the 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.” Petitioner’s New
York City facility, which offers cardio machines, strength machines, free weights, training areas,
stretching areas, workout workshops and online weight loss programs, provides activities
directed toward the improvement of health and bodily appearance. Accordingly, it constitutes a
“weight control salon, health salon or gymnasium” for purposes of the New York City local sales
tax. See NYC Admin. Code § 11-2002(a).
Petitioner further asks whether the presence of a pool and basketball court at its New
York City facility would qualify for an exemption from the New York City local sales tax. It
does not. Prior to 2008, Administrative Code § 11-2002(f)(1), which imposed tax on admissions
to places of amusement, exempted “charges to a patron for admission to, or use of, facilities for
sporting activities in which such patron is to be a participant, such as bowling alleys and
swimming pools.” The Tax Appeals Tribunal determined that the participatory sports exemption
applied to former Administrative Code § 11-2002, which specifically included charges by weight
control salons, health salons, gymnasiums, Turkish and sauna baths. Matter of Prospect Park
Health and Racquet Associates, Tax Appeals Tribunal (July 22, 1997). As such, under the

-2-

TSB-A-20(25)S
Sales Tax
November 3, 2020

former Administrative Code, a gymnasium with participatory sports was exempt from the New
York City local sales tax.
However, in 2008, the Administrative Code was amended and expressly excluded the
participatory sports exemption. Administrative Code § 11-2001(a)(3) now reads
“notwithstanding any contrary provision of this section or other law, this section: … does not
omit from the tax described in paragraph one of subdivision (f) of section eleven hundred five of
the tax law charges to a patron for admission to, or use of, facilities for sporting activities in
which such patron is to be a participant, such as bowling alleys and swimming pools.”
Accordingly, since the 2008 amendments expressly removed the participatory sports
exemption from the tax on admission charges, the New York City Administrative Code no
longer exempts facilities with participatory sports from the tax on weight control salons, health
salons, gymnasiums and similar facilities. Therefore, Petitioner’s charges are subject to New
York City local sales tax.
DATED: November 3, 2020

/S/
DEBORAH R. LIEBMAN
Deputy Counsel
NOTE:

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.