Does a paintball or 'survival game' operator have to charge sales tax on the admission to play, and on the equipment used in the game?

Plain-English summary

Ralph M. Toscano Jr. asked how sales tax applies to a "survival game" — teams on a playing field shooting CO2-powered, non-toxic paint pellets at each other (paintball), where the customer is a participant. The question was whether the admission charge and the equipment to play are taxable.

The Department held the admission is exempt, and the equipment is taxable only if charged for separately.

• Admission for a participant is exempt. Tax Law § 1105(f)(1) taxes admission to a place of amusement, except a charge to a patron for admission to, or use of, facilities for sporting activities in which the patron is a participant. Because the customer plays the survival game, the admission charge is not taxable (like lift tickets or bowling-lane and swimming-pool admissions).
• Equipment bundled into the admission = no TPP sale, but the operator pays tax. If the operator supplies the pistol, goggles, paint, and CO2 and does not charge a separate and distinct fee for it, the operator is not selling tangible personal property (like a bowling alley that hands out house balls). But the operator must then pay sales tax on its own purchases of that equipment, because it is the consumer of it.
• Equipment billed separately = a taxable sale. If the operator charges a separate, distinct fee for the use of equipment, that is a taxable sale of tangible personal property under § 1105(a). The operator may then buy the equipment tax-free for resale (Form ST-120), but must keep adequate records — and any resale-certificate equipment it hands to patrons as part of the admission must be reported as a use-taxable purchase (20 NYCRR 532.4(d)(3)).
• Reminder on burden. Under § 1132(c), amusement charges are presumed taxable until the collector proves otherwise.

What this means for you

Charging people to play a sport they participate in is generally not a taxable admission in New York. Paintball, bowling, skiing, swimming — where the patron is a participant, § 1105(f)(1) exempts the admission or facility-use charge.

How you handle equipment decides who pays the tax. If the gear comes with admission at no separate charge, you're not making a taxable sale — but you owe tax on buying that gear (you're the end consumer). If you break out a separate equipment charge, that charge is a taxable rental/sale, and you can buy the gear for resale instead.

Don't mix the two treatments. If you bought equipment tax-free for resale but then hand it out as part of admission, you owe use tax on it, because it wasn't actually resold.

Common questions

Q: Is the fee to play paintball / a survival game taxable?
A: No. It's an admission to a participatory sporting activity, which is exempt under § 1105(f)(1).

Q: We include all the gear in the price. Do we charge tax on anything?
A: Not on the admission, and you're not making a taxable equipment sale — but you must pay sales tax when you buy that gear, since you're the consumer of it.

Q: We charge a separate equipment fee. Is that taxable?
A: Yes. A separate, distinct charge for the use of equipment is a taxable sale of tangible personal property under § 1105(a). You can then buy the gear for resale with Form ST-120.

Q: We bought gear for resale but gave some to players with their admission. Now what?
A: You must report that gear as a purchase subject to use tax, because it was consumed with the admission rather than resold.

Citations and references

Statute and regulation:

• Tax Law § 1105(f)(1) — taxes amusement admissions but excludes charges for participatory sporting facilities
• Tax Law § 1105(a) — taxes retail sales of tangible personal property (a separate equipment charge)
• Tax Law § 1132(c) — presumes amusement charges taxable, placing the burden on the collector
• 20 NYCRR 527.10 — illustrates participatory sporting admissions (bowling, swimming, ski lifts) versus taxable equipment rentals
• 20 NYCRR 532.4(d)(3) — resale-certificate property supplied to patrons must be reported as a use-taxable purchase
• National Survival Game of New York, Inc., TSB-A-85(47)S — prior opinion treating bundled survival-game equipment as not a separate sale

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1988.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a88_2s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-88(2)S
Sales Tax
December 9, 1987

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S870917A

On September 17, 1987, a Petition for Advisory Opinion was received from Ralph M.
Toscano Jr., 23 Hathaway Road, Rochester, New York, 14617.
The issue raised is whether the charge for admission to a 'survival game' and equipment
required to play the game is subject to sales tax when the customer is a participant in the game.
Survival games are generally played on a playing field with two or more parties engaged in
a shooting match using CO2 powered weapons that shoot non-toxic paint pellets. While not stated
in the Petition, it is presumed this is the type of survival game which is the subject of Petitioner's
inquiry.
Section 1105(a) of the Tax Law imposes a sales tax on the receipts from every retail sale of
tangible personal property, except as otherwise excluded or exempted.
Section 1105(f)(1) of the Tax Law imposes a sales tax on any admission charge to or for the
use of any place of amusement in the state except charges to a patron for admission to, or use of,
facilities for sporting activities in which such patron is to be a participant.
Section 1132(c) of the Tax Law provides that all amusement charges of any type mentioned
in section l105(f) are subject to tax until the contrary is established and that the burden of proving
that any amusement charge is not taxable is on the person required to collect tax.
Regulation section 527.10(d)(4) illustrates the applicability of section 1105(f)(1) of the Tax
Law with the following examples:
Example 6: Admission charges for the use of bowling lanes and swimming pools are not
subject to tax. However, any charge for the use of tangible personal property in conjunction
with the sporting activity is taxable. Included as taxable would be bowling shoes, towel and
locker rentals.
Example 7: A ski resort's charge for lift tickets is an exempt admission charge to a sporting
facility in which the patron will be a participant. If the facility charges for the use of skis or
other equipment, such charge is for the rental of tangible personal property which is subject
to tax. (20 NYCRR 527.10).
Accordingly, the admission charge for participating in the survival game is not subject to tax
since the patron is a participant.

RODERICK G. W. CHU, COMMISSIONER
GABRIEL B. DiCERBO, DEPUTY COMMISSIONER
FRANK J. PUCCIA, DIRECTOR
TP-8 (3/83)

-2­
TSB-A-88(2)S
Sales Tax
December 9, 1987
If the operator of the survival game provides equipment (pistol, goggles, paint and CO2)
necessary to play the game and does not charge a fee separate and distinct from the admission fee,
then such operator is not selling tangible personal property within the meaning of section 1105(a)
of the Tax Law. (20 NYCRR 527.10 (b)(1)(i)). National Survival Game of New York, Inc. Advisory
Opinion of the State Tax Commission, September 19, 1985, TSB-A-85(47)S. Such a situation is
analogous to a bowling alley providing bowling balls or a miniature golf course providing putters
and golf balls. In each of these cases, the charge to the patron is the same whether or not the
participant uses the equipment (e.g. a bowler using his own ball instead of a house ball).
However, it should be noted that such operator is required to pay sales tax on its purchases
of all such equipment.
If the Petitioner charges a fee (in a separate and distinct transaction from the admission) for
the use of equipment, such a transaction constitutes a taxable sale of tangible personal property
pursuant to section 1105(a) of the Tax Law. Accordingly, the Petitioner may purchase such
equipment tax free by giving his supplier a properly completed Resale Certificate (Form ST-120).If
the Petitioner purchases equipment using a Resale Certificate, the Petitioner must maintain adequate
records to verify the sales and use tax status of such purchases. (20 NYCRR 533.2). Equipment
purchased tax exempt with a Resale Certificate which is supplied to the patron as part of the
admission, must be reported as a purchase subject to use tax. (20 NYCRR 532.4(d)(3)).

DATED: December 9, 1987

s/FRANK J. PUCCIA
Director
Technical Services Bureau

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.