Which entertainment and recreation charges did South Carolina treat as taxable admissions under Revenue Ruling 05-14?

Plain-English summary

South Carolina Revenue Ruling #05-14 applied the admissions tax to the paid right or privilege to enter or use a place of amusement. A location did not need to charge at the door: a fee to use a bowling alley, court, range, course, club, ride, or other facility could be an admission.

The Department defined a place of amusement broadly as an enclosure or location with an activity that occupies spare time, distracts the mind, relaxes, entertains, or gives pleasure. A business, educational, or other additional purpose did not prevent the location from being an amusement.

The ruling listed many taxable examples, including amusement parks and rides, shows and exhibitions, sporting events and facilities, bowling alleys, golf courses, health clubs, museums, concerts, theaters, zoos, tours, cruises with entertainment, and cover charges. The list was expressly not exhaustive, and statutory exemptions controlled.

RR 26-2 later expressly superseded and updated RR 05-14. The later ruling should be used for current examples and changes in the law.

What this means for you

Entertainment and recreation operators

The relevant charge was not limited to an entrance ticket. Fees for the privilege of using a definite location or facility could fall within the admissions tax even when entry itself was free.

Nonprofits and exempt attractions

The ruling quoted multiple statutory exemptions, but it also described limits. For example, a nonprofit carnival or fair could still owe tax on rides and amusement facilities, and entertainment held at a registered historic site did not automatically share the site's exemption.

Clubs, instructors, and rental businesses

The ruling distinguished fees for using a place of amusement from some charges that it did not treat as admissions, including specified lesson fees, participant entry fees apart from ordinary facility charges, certain tour or charter rides, golf-cart and watercraft rentals, and qualifying one-time initiation fees. Later law changed some club-dues treatment.

Common questions

Q: Did a venue have to charge an entrance fee?
A: No. The ruling said a paid charge to use the place could be taxable even when entry was free.

Q: Was every educational or historical attraction exempt?
A: No. A location could still be a place of amusement even when it also had an educational or business purpose, and the ruling required a specific statutory exemption.

Q: Was every fee charged by a golf or tennis facility an admission?
A: No. The ruling distinguished facility-use charges from instructor lessons, participant entry fees apart from customary facility charges, golf-cart rentals, trail fees, and qualifying initiation fees. Later guidance changed some golf-club-dues treatment.

Q: Is RR 05-14 current?
A: No. RR 26-2 expressly superseded it and provides the Department's updated places-of-amusement guidance.

Citations and references

• S.C. Code Ann. § 12-21-2410 — definitions of admission, place, and person
• S.C. Code Ann. § 12-21-2420 — admissions tax and statutory exemptions
• S.C. Code Ann. § 12-21-2430 — private-pond rule
• SC Revenue Ruling 26-2 — expressly superseded and updated RR 05-14

Source

• Landing page: SC Advisory Opinion Search
• Original PDF: RR05-14.pdf
• Official superseding RR 26-2 PDF: RR26-2.pdf

Original ruling text

State of South Carolina

Department of Revenue
301 Gervais Street, P. O. Box 125, Columbia, South Carolina 29214
Website Address: http://www.sctax.org

SC REVENUE RULING #05-14

SUBJECT:

Places of Amusement
(Admissions Tax)

EFFECTIVE DATE:

Applies to all periods open under the statute.

SUPERSEDES:

All previous advisory opinions and any oral directives in conflict
herewith.

REFERENCES:

S. C. Code Ann. Section 12-21-2420 (2000; Supp. 2004)
S. C. Code Ann. Section 12-21-2410 (2000)
S. C. Code Ann. Section 12-21-2430 (2000)

AUTHORITY:

S. C. Code Ann. Section 12-4-320 (2000)
S. C. Code Ann. Section 1-23-10(4) (Supp. 2004)
SC Revenue Procedure #03-1

SCOPE:

The purpose of a Revenue Ruling is to provide guidance to the public
and to Department personnel. It is a written statement issued to apply
principles of tax law to a specific set of facts or a general category of
taxpayers. A Revenue Ruling does not have the force or effect of
law, and is not binding on the public. It is, however, the
Department’s position and is binding on agency personnel until
superseded or modified by a change in statute, regulation, court
decision, or advisory opinion.

Introduction:
The State of South Carolina imposes an admissions tax for the privilege of entering and using a
place of amusement. The purpose of this advisory opinion is to provide examples of places of
amusements that are subject to this tax. The list of examples is not all-inclusive and is being
provided as guidance for taxpayers.

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Law and Discussion:
Code Section 12-21-2420 imposes the admissions tax and states in part:
There must be levied, assessed, collected, and paid upon paid admissions to
places of amusement within this State a license tax of five percent. The license
tax may be listed separately from the cost of admission on an admission ticket. …
Code Section 12-21-2410 defines the terms “admissions,” “place,” and “person” and states:
For the purpose of this article and unless otherwise required by the context:
(1) The word “admission” means the right or privilege to enter into or use a place
or location;
(2) The word “place” means any definite enclosure or location; and
(3) The word “person” means individual, partnership, corporation, association, or
organization of any kind whatsoever.
In summary, the admissions tax is imposed upon the paid right or privilege to enter into or use a
place of amusement.
It is important to note that the statute taxes charges to "use" a place of amusement, as well as
charges to enter a place of amusement. This is seen in Beach v. Livingston, 248 SC 135, 149
SE2d 328 (1966), where the South Carolina Supreme Court held that the admissions tax applied
to charges paid for the "use" of a bowling alley even though no charge was required for a person
to “enter” the bowling alley. Additionally, an Attorney General's Opinion dated August 2, 1956
(See Attorney General's Report, July 1, 1955 to June 30, 1957) concluded the charge made by a
person operating a golf driving range was subject to the admissions tax.
The statute, however, does not define the term “amusement.” However, the following from SC
Revenue Ruling #89-8 outlines the Department’s longstanding position as to what constitutes an
“amusement” and a “place of amusement.”
One of the primary rules of statutory construction is that words used in a statute
should be taken in their ordinary and popular meaning, unless there is something
in the statute which requires a different interpretation. Hughes v. Edwards, 265
S.C. 529, 220 S.E. 2d 231 (1975); Investors Premium Corp. v. South Carolina
Tax Commission, 260 S.C. 13, 193 S.E. 2d 642 (1973). Also, where the terms of
a statute are clear and unambiguous and leave no room for construction, they must
be applied according to their literal meaning. Mitchell v. Mitchell, 266 S.C. 196,
222 S.E. 2d 217 (1976); Green v. Zimmerman, 269 S.C. 535, 238 S.E. 2d 323
(1977).

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It is an accepted practice in South Carolina to resort to the dictionary to determine
the literal meaning of words used in statutes. For cases where this has been done,
see Hay v. South Carolina Tax Commission, 273 SC 269, 255 SE 2d 837 (1979);
Fennell v. South Carolina Tax Commission, 233 S.C. 43, 103 SE2d 424 (1958);
Etiwan Fertilizer Co. v. South Carolina Tax Commission, 217 SC 484, 60 SE2d
682 (1950).
Black's Law Dictionary, Fifth Edition, defines the term "amusement" to mean:
"Pastime, diversion, enjoyment. A pleasurable occupation of the senses or that
which furnishes it."
The Second College Edition of the American Heritage Dictionary provides the
following definitions:
“Amusement"

1. The state of being amused,
   entertained, or pleased. 2. Something
   that amuses.

"Pastime"

An activity that occupies one's spare
time pleasantly.

"Diversion"

Something that distracts the mind and
relaxes or entertains.

"Enjoyment"

1. The act or state of enjoying. 2. The
   use or possession of something
   beneficial or pleasurable. 3. Something
   that gives pleasure.

In summary, a "place of amusement" is any enclosure or location consisting of an
activity that occupies one's spare time, distracts the mind, relaxes, entertains, or
gives pleasure.
Further, in Radcliff v. Query, 153 S.C. 76, 150 S.E. 352 (1929), an Admission's
Tax case, the Supreme Court of South Carolina held:
The statute is broad enough to include all classes of public exhibitions,....
(emphasis added).
Black's Law Dictionary, Fifth Edition, defines "public" in part, as:
Public, adj. Pertaining to a state, nation, or whole community; proceeding
from, relating to, or affecting the whole body of people or an entire
community. Open to all; notorious. Common to all or many; general; pen to
common use. Belonging to the people at large; relating to or affecting the
whole people or a state, nation, or community; not limited or restricted to

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any particular class of the community. Peacock v. Retail Credit Co.,
D.C.Ga., 302 F.Supp.418, 423 (emphasis added).
In addition, the Appellate Division of the New York Supreme Court held in Wien
v. Murphy, 284 N.Y.S. 2d 303, 28 A.D. 2d 222 (1967) that:
... if in fact a place or facility provides something edifying or educational in
addition to enjoyment, entertainment or amusement, it is no less a place of
amusement.
In other words, the term "place of amusement" is not to be strictly construed so as
to exclude places which may also have a business or other purpose. If a place
distracts the mind, relaxes, entertains, or gives pleasure, then such place is a
"place of amusement".
Finally, Code Section 12-21-2420 establishes various exemptions from the admissions tax and
states in part:
… , no tax may be charged or collected:
(1) On account of any stage play or any pageant in which wholly local or
nonprofessional talent or players are used;
(2) On admissions to athletic contests in which a junior American Legion athletic
team is a participant unless the proceeds inure to any individual or player in the
form of salary or otherwise;
(3) On admissions to high school or grammar school games or on general gate
admissions to the State Fair or any county or community fair;
(4) On admissions charged by any eleemosynary and nonprofit corporation or
organization organized exclusively for religious, charitable, scientific, or
educational purposes; or the presentation of performing artists by an accredited
college or university; provided, that the license tax herein levied and assessed
shall be collected and paid upon all paid admissions to all athletic events of any
institution of learning above the high school level; provided, however, that
carnivals, circuses, and community fairs operated by eleemosynary or nonprofit
corporations or organizations organized exclusively for religious, charitable,
scientific, or educational purposes shall not be exempt from the assessment and
collection of admissions tax on charges for admission for the use of or entrance to
rides, places of amusement, shows, exhibits, and other carnival facilities, but not
to include charges for general gate admissions except when the proceeds of any
such carnival, circus, or community fair are donated to a hospital; provided,
further, that no admission tax shall be charged or collected by reason of any
charge made to any member of a nonprofit organization or corporation for the use
of the facilities of the organization or corporation of which he is a member.

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(5) On admissions to nonprofit public bathing places;
(6) On admissions to any hunting or shooting preserve;
(7) On admissions to privately owned fish ponds or lakes; and
(8) On admissions to circuses operated by eleemosynary, nonprofit corporations
or organizations organized exclusively for religious, charitable, scientific, or
educational purposes when the proceeds derived from admissions to the circuses
shall be used exclusively for religious, charitable, scientific or educational
purposes.
(9) On admissions to properties or attractions which have been named to the
National Register of Historical Places.
(10) On admissions charged to classical music performances of a nonprofit or
eleemosynary corporation organized and operated exclusively to promote
classical music.
(11) On admissions to events other than those events enumerated in item (4) of
this section, sponsored and operated exclusively by eleemosynary, nonprofit
corporations or organizations organized exclusively for religious, charitable,
scientific, civic, fraternal, or educational purposes when the net proceeds derived
from admissions to the events shall be immediately donated to an organization
operated exclusively for charitable purposes. The term “net proceeds” shall mean
the portion of the gross admissions proceeds remaining after necessary expenses
of the event have been paid. This item shall not apply to an event in which the
above organizations receive a percentage of gross proceeds or a stated fixed sum
for the use of its name in promoting the event.
(12) On admissions charged by nonprofit or eleemosynary community theater
companies or community symphony orchestras, county and community arts
councils and departments and other such companies engaged in promotion of the
arts.
(13) On admissions to boats which charge a fee for pleasure fishing, excursion,
sight-seeing and private charter.
(14) On admissions to a physical fitness center subject to the provisions of
Chapter 79 of Title 44, the Physical Fitness Services Act, that provides only the
following activities or facilities:
(a) aerobics or calisthenics;
(b) weightlifting equipment;
(c) exercise equipment;

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(d) running tracks;
(e) racquetball;
(f) swimming pools for aerobics and lap swimming; and
(g) other similar items approved by the department.
The entire admission charge of a physical fitness center which provides any other
activity or facilities is subject to the tax imposed by this article. Physical fitness
facilities or centers of the State of South Carolina and any of its political
subdivisions which are exempt from the Physical Fitness Services Act, pursuant
to Section 44-79-110 and, therefore, subject to the admissions tax under this
article are nevertheless exempt from the admissions tax if they meet other
requirements of this subsection.
(15) for entry into the pit area of NASCAR sanctioned motor speedways or
racetracks for drivers, crew members, or car owners where a participation fee is
charged these persons by NASCAR, or by the speedway or racetrack, where a
charge to these persons is made on a per event basis for entry into the pit area, or
where a combination of annual and per event charges to these persons is made for
entry into the pit area.
The tax imposed by this section must be paid by the person or persons paying the
admission price and must be collected and remitted to the South Carolina
Department of Revenue by the person or persons collecting the admission price.
The tax imposed by this section does not apply to:
(a) any amount separately stated on the ticket of admission for the repayment
of money borrowed for the purpose of constructing an athletic stadium or field
by any accredited college or university; or
(b) any amount of the charge for admission, whether or not separately stated,
that is a fee or tax imposed by a political subdivision of the State.
The revenue derived from the provisions of this section from fishing piers along
the coast of South Carolina is allocated for use of the Commercial Fisheries
Division of the Department of Natural Resources.
Also, Code Section 12-21-2430 provides an exemption for certain ponds, and states:
No private pond shall be declared an amusement for tax purposes. But this
section shall not apply to a pond stocked with fish from a State or Federal
hatchery.

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Examples of Places of Amusements Subject to the Admissions Tax
The following list of places of amusements is not all inclusive and is merely provided as
guidance. Charges to enter or use these places, events, facilities and rides and all other
amusement facilities are subject to the tax unless specifically exempted under Code Section
12-21-2420 or Code Section 12-21-2430:
air shows
amusement parks
amusement rides, shows and exhibits
animal shows
antique shows
aquariums
aquatic shows
archery range
art and craft exhibitions (See SC Revenue Ruling #89-8.)
automobile shows
balloon shows
baseball batting cages (See SC Revenue Ruling 91-14.)
basketball courts
boat cruises (See, however, Code Section 12-21-2420(13). Charges for cruises with
entertainment, such as one in which patrons attempt to solve a murder mystery, do not
come within the exemption in Code Section 12-21-2420(13).)
boat shows
botanical gardens
bowling alleys
bungee jumping

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carnival, circus and fair entrance fees, rides, shows, exhibits, games and other amusement
charges
college, professional and other sporting events (football, basketball, baseball, or hockey
games; golf tournaments, tennis tournament, rodeos, car racing, polo, horse racing,
wrestling, boxing, etc.)
comedy clubs
cruises that offer entertainment (i.e. bands, audience role participation, or plays)
dance halls
dance shows
dinner theaters and attractions (See SC Private Letter Ruling #92-5.)
dog shows
fishing piers and ponds
flight and similar simulators
go cart or car racing tracks to include “pit passes”
golf courses and country clubs (green fees, range fees, membership dues) (See SC
Revenue Ruling #91-18 and SC Private Letter Ruling #91-5.)
golf driving ranges
gun and knife shows
handball courts
health clubs (See, however, SC Revenue Ruling 92-1 for a discussion of exempt health
clubs.)
historical attractions (See, however, Code Section 12-21-2420(9). Note: Charges for
entertainment events, such as rock concerts, on the grounds of a location on the National
Register of Historical Places do not come within the exemption in Code Section 12-212420(9).)
holiday celebrations and events (Halloween haunted houses, New Year Eve parties,
firework shows, crop circles and mazes, etc.)
historical dramas

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home shows
home tours (new homes, historical homes, Christmas tours, etc.)
horse shows
laser tag
mazes, including crop mazes
miniature golf or putt-putt courses
miniature or slot car tracks
“monster” truck shows
motorcycle expositions, races and shows
movie theaters or movie “peep show” machines
museums
music concerts
nightclubs, lounges, or bars with a cover charge
pageants
paint ball or laser gun facilities
para sail rides
Parade of Homes tours
planetariums
plays
promotional events such as boat shows, home shows, antique shows, gun and knife
shows, and wildlife shows (See SC Revenue Ruling #89-8.)
race car or similar tracks (reality racing, ATV tracks, etc.)
racquetball courts

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rock climbing facilities
rodeos
serpentariums
skating rinks or skate board parks
shooting ranges (target, skeet, trap sporting clays, etc.)
spas
spectator events (football, basketball, baseball, or hockey games; golf tournaments, tennis
tournaments, rodeos, car racing, polo, horse racing, wrestling, boxing, etc.)
sport clubs
sporting events for spectators (football, basketball, baseball, or hockey games; golf
tournaments, tennis tournaments, rodeos, car racing, polo, horse racing, wrestling,
boxing, etc.)
squash courts
stage plays or performances
swimming pools and clubs (pool fees, membership dues)
target, skeet, trap or sporting clay ranges
theaters
tractor pulls
tennis or racquetball courts (court fees, membership dues)
water parks
water-skiing shows
water slides
wildlife preserves
wildlife expositions and shows
zoos

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It should be noted that it has been the longstanding position of the Department that (1) fees for
golf, tennis, dancing, and self-defense lessons from an instructor; (2) tournament participant
entry fees (exclusive of the normal and customary charges to utilize the place of amusement, i.e.
green or court fees); (3) fees for boat, carriage, helicopter, plane or bus rides for touring, charter,
fishing, or excursion (see SC Technical Advice Memorandum #95-2.); (4) golf cart fees (subject
to sales tax as rentals); (5) “trail fees” (fees charged by golf courses for someone using their own
golf cart); (6) boat or jet ski rental fees (subject to sales tax); (7) fees for using tanning beds; (9)
initiation fees for country clubs, golf clubs, tennis clubs and similar facilities1 provided the
initiation fee is a one-time (nonrecurring) charge paid as a prerequisite to joining the club; and
(10) fees for equestrian lessons are not fees to enter or use a place of amusement and are not
subject to the admissions tax.
Note: Organizations, event organizers, and others operating places of amusement should
review Code Sections 12-21-2420 and 12-21-2430 to determine if there organization,
location or event falls within one of the statutory exemptions. The burden of proof that an
organization, location or event falls within an exemption rests with the operator of the
place of amusement.
An application for admissions tax exemption under Code Section 12-21-2420 may be
submitted to the Department on Form L-2068. A copy of this “License Tax” form can be
found on the Department’s website (www.sctax.org) under “Quick Links” (“Forms and
Instructions”). An organization, location or event does not need to apply for the exemption
in order to be exempt, but must be able to document (charter, by-laws, financial records,
etc) that an exemption is applicable.
SOUTH CAROLINA DEPARTMENT OF REVENUE

s/Burnet R. Maybank III
Burnet R. Maybank III, Director
September 15
, 2005
Columbia, South Carolina

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An initiation fee should not allow a person to utilize the facilities of the club without payment of a recurring charge
(membership dues). In other words, a one-time charge that is a substitute for recurring membership dues is not an
initiation fee.

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