When a South Carolina dinner theater charges one ticket price for a meal plus a show, is the ticket taxed as a meal, as an admission, or both?

Plain-English summary

A dinner attraction show is the kind of dinner-theater experience where one ticket price gets a customer both admittance to watch a show and a meal. Revenue Ruling #25-8 answers how South Carolina taxes that single ticket — and the answer is that two different taxes apply to one price.

The Department uses the familiar "true object" test to sort taxable sales of tangible personal property (food is TPP) from nontaxable services. Normally that test finds a single true object, making the whole transaction either taxable or not. A dinner attraction show is different: it has two true objects — the sale of a meal and the sale of entertainment — sold together, with neither one incidental to the other. Quoting the classic rule (from Snite v. Department of Revenue by way of 9 Vanderbilt Law Review 231), the Department concludes the operator is "engaged in the business of selling [a meal] at retail, and also engaged in the business of furnishing [an] entertainment service, and is subject to [sales] tax as to the one business and tax exempt [for sales tax] as to the other."

So the tax splits along the price:

• Sales tax (6%) applies to the portion of the ticket that represents the price of the meal [§ 12-36-910; § 12-36-90].
• Admissions tax (5%) applies to the portion that represents the price of the admission to the place of amusement [§ 12-21-2420; § 12-21-2410]. The Department notes its longstanding policy for a "package deal" (one that bundles tangible personal property with an admission) is to tax only the admissions portion for admissions-tax purposes.

The catch that runs through the whole ruling: the operator may only tax each portion provided the price breakdown is reasonable and supported by the taxpayer's records. If the records don't back up the amounts reported for sales tax or admissions tax, the Department may employ any proper and reasonable audit method to determine the liability [§ 12-54-100].

RR #25-8 modifies SC Private Letter Ruling #92-5 (the Department's earlier position on this kind of transaction).

What this means for you

Dinner-theater and dinner-show operators

Don't treat the ticket as all-meal or all-admission — it's both. Build your pricing and point-of-sale system so the meal component and the admission component are each identified, then collect 6% sales tax on the meal portion and 5% admissions tax on the admission portion. The single most important compliance step is documentation: keep records that make the meal-vs-admission split reasonable and defensible, because if you can't support it, the Department can reconstruct the tax by audit. If you previously relied on Private Letter Ruling #92-5, note this ruling modifies it.

Restaurants and venues adding a "show" or experience

If you bundle a genuine entertainment/show with a meal for one price, you may be in dinner-attraction-show territory — meaning an admissions tax obligation on top of sales tax, not just sales tax on food. The line matters: where the meal is the real object and any entertainment is truly incidental (background music, say), the whole charge is a taxable meal; where there are two genuine objects sold together, you split. When in doubt about which side of the line a particular package falls on, get specific guidance.

Accountants and tax professionals

This is a two-object application of the true-object test — an explicit departure from the usual "one true object → all-or-nothing" outcome, grounded in the Snite "subject to tax as to the one business and exempt as to the other" formulation and in Greystone Catering (food is TPP). Practically, the reasonableness-and-records proviso is the whole ballgame on audit; a documented, arm's-length allocation between meal and admission is what protects the split. Remember the admissions tax is a separate 5% under Chapter 21, not a variation of the sales tax.

Common questions

Q: Is a dinner-show ticket taxed as a meal or as an admission?
A: Both. Sales tax (6%) applies to the meal portion of the price and admissions tax (5%) applies to the admission portion — provided the split is reasonable and supported by your records.

Q: How do I decide how much of the ticket is "meal" versus "show"?
A: You allocate the price between the two, but the allocation must be reasonable and backed by your records. If it isn't, the Department may determine the tax using any proper and reasonable audit method under § 12-54-100.

Q: Why isn't the whole ticket just taxed one way?
A: Because a dinner attraction show has two true objects — the meal and the entertainment — and neither is merely incidental to the other, so each is taxed under its own statute.

Q: Does this change earlier guidance?
A: Yes. RR #25-8 modifies SC Private Letter Ruling #92-5.

Citations and references

Statutes:

• S.C. Code Ann. § 12-36-910 — imposes the 6% sales tax on gross proceeds of retail sales of tangible personal property (5% base under § 12-36-910(A) plus 1% under § 12-36-1110)
• S.C. Code Ann. § 12-36-90 — defines "gross proceeds of sales"
• S.C. Code Ann. § 12-21-2420 — 5% admissions tax on all paid admissions to places of amusement
• S.C. Code Ann. § 12-21-2410 — defines "admissions" as the right or privilege to enter into or use a place or location
• S.C. Code Ann. § 12-54-100 — authorizes the Department to use proper audit methods to determine tax liability

Regulation:

• S.C. Regulation 117-308 — services are not taxed when the service is the true object of the transaction

Authority discussed in prose (not linked): the "true object" test as stated in 9 Vanderbilt Law Review 231 (1956) and Snite v. Department of Revenue, 398 Ill. 41, 74 N.E.2d 877 (1947); Greystone Catering Co. v. S.C. Dep't of Revenue, 326 S.C. 551, 486 S.E.2d 7 (Ct. App. 1997) (food is tangible personal property).

Source

• Landing page: SC Advisory Opinion Search
• Original PDF: RR25-8.pdf

Original ruling text

STATE OF SOUTH CAROLINA

DEPARTMENT OF REVENUE

2= /BOOA Outlet Pointe Blvd., Columbia, South Carolina 29210
y P.O. Box 125, Columbia, South Carolina 29214-0575

SC REVENUE RULING #25-8

SUBJECT: Dinner Attraction Shows
(Sales Tax and Admissions Tax)

EFFECTIVE DATE: All periods upon under the statute.
MODIFIES: SC Private Letter Ruling #92-5
REFERENCES: S.C. Code Ann. Section 12-36-90 (2014)

S.C. Code Ann. Section 12-36-910 (2014)
S.C. Code Ann. Section 12-21-2410 (2014)
S.C. Code Ann. Section 12-21-2420 (2014)

AUTHORITY: S.C. Code Ann. Section 12-4-320 (2014)
SC Revenue Procedure #09-3

SCOPE: The purpose of a Revenue Ruling is to provide guidance to the
public. It is an advisory opinion issued to apply principles of tax law
to a set of facts or general category of taxpayers. It is the
Department’s position until superseded or modified by a change in
statute, regulation, court decision, or another Department advisory
opinion.

INTRODUCTION:

This ruling explains how the sales tax and admissions tax apply to dinner attraction shows, where
customers, after paying one ticket price, receive admittance into a dinner theater to watch a show
while also receiving a meal.

LAW AND DISCUSSION:

SALES TAX

South Carolina law imposes “[a] sales tax, equal to [six]! percent of the gross proceeds of sales .
. . upon every person engaged or continuing within this State in the business of selling tangible

S.C. Code Ann. § 12-36-910(A) imposes a 5% sales and use tax. S.C. Code Ann. § 12-36-1110
imposes an additional 1% sales and use tax rate.

personal property at retail.” The measure or basis of the sales tax is calculated on the “gross
proceeds of sales,” which is defined as “the value proceeding or accruing from the sale, lease, or
rental of tangible personal property.” The term includes the proceeds from the sale of tangible
personal property without any deduction for the cost of goods sold, the cost of materials, labor, or
service, or any other expenses. South Carolina law does not impose sales tax on receipts from
services,’ “when the services are the true object of the transaction.”>

When a transaction includes both non-taxable services and taxable sales of tangible personal
property, the Department, as well as South Carolina courts, have used the “true object” test to
determine the true object of the transaction. Applying this test to dinner attraction shows, it must
be determined whether the meal° or the entertainment services are the true object of the transaction.

If the meal is the true object and the entertainment is incidental to the sale of the meal, the entire
charge for the ticket would be subject to the sales tax. If the true object of the transaction is the
show and the meal is incidental to the show, the charge for the ticket would not be subject to the
sales tax.’

The “true object” test is best described in 9 Vanderbilt Law Review 231 (1956), wherein it is
stated:

The true test then is one of basic purpose of the buyer. When the product of the
service is not of value to anyone other than the purchaser, either because of the
confidential character of the product, or because it is prepared to fit the purchaser’s
special need — a contract or will prepared by a lawyer, or the accident investigation
report prepared for an insurance company — this fact is evidence tending to show
that the service is the real purpose of the contract. When the purpose of a contract
is to produce an article which is the true object of the agreement, the final transfer
of the product should be a sale, regardless of the fact that special skills and
knowledge go into its production. Under this analysis, printing work, done on
special order, and of significant value only to the particular customer, is still a sale.
The purchaser is interested in the product of the services of the printer, not in the
services per se. Similarly, it would seem that contracts for custom-produced
articles, be they intrinsically valuable or not, should be classified as sales when the
product of the contract is transferred.

'§.C. Code Ann. § 12-36-90.

3.§.C. Code Ann. § 12-36-90(1).

4 With the exception of those services on which South Carolina law specifically imposes the sales
and use tax (i.e. accommodation services, communication services). S.C. Regulation 117-308.

§.C. Regulation 117-308.

® Food is tangible personal property for purposes of the sales and use tax. See Greystone Catering
Co. Inc. v. S.C. Dep’t of Revenue, 326 S.C. 551, 552, 486 S.E.2d 7, 8 (Ct. App. 1997).

’ Although the charge for the ticket in this scenario would not be subject to sales tax, the charge
would still be subject to admissions tax, as the Department discusses below.

2

The Vanderbilt Law Review article, in quoting Snite v. Department of Revenue, 398 III. 41, 74
N.E.2d 877 (1947), also establishes the following general rule:

If the article sold has no value to the purchaser except as a result of services
rendered by the vendor, and the transfer of the article to the purchaser is an actual
and necessary part of the services rendered, then the vendor is engaged in the
business of rendering service, and not in the business of selling at retail. If the article
sold is the substance of the transaction and the service rendered is merely incidental
to and an inseparable part of the transfer to the purchaser of the article sold, then
the vendor is engaged in the business of selling at retail, and the tax which he pays
. .. [iS measured by the total cost of article and services]. Jf the service rendered in
connection with an article does not enhance its value and there is a fixed or
ascertainable relation between the value of the article and the value of the service
rendered in connection therewith, then the vendor is engaged in the business of
selling at retail, and also engaged in the business of furnishing service, and is
subject to [sales] tax as to the one business and ... exempt [from sales tax] as to
the other. (Emphasis added).

While the above quotes do not establish rigid rules, they provide general guidance in determining
the purpose of a transaction, and are particularly helpful in addressing the unique issues presented
in these dinner attraction shows.

In regard to dinner attraction shows, there is not one true object, but two — the sale of a meal and
the sale of entertainment. The meal and the entertainment are sold together, and one is not
incidental to the other. Therefore, a dinner attraction show “is engaged in the business of selling
[a meal] at retail, and also engaged in the business of furnishing [an entertainment] service, and is
subject to [the sales] tax as to the one business and tax exempt [for sales tax purposes] as to the
other.”* This is distinguishable from other transactions analyzed by South Carolina courts and the
Department under the true object test, where the facts and circumstances indicated that there was
one distinct “true object” of the transaction, making the entire transaction either taxable or not
taxable.°

In considering the above discussion, dinner attraction shows will only be required to remit the
sales tax on that portion of the charge representing the price of the meal, provided it is reasonable
and supported by the records of the taxpayer.

8 See Snite v. Department of Revenue, 398 Ill. 41, 46, 74 N.E.2d 877, 880 (1947).

° See Rent-A-Center East, Inc. v. S.C. Dep’t of Revenue, 425 S.C. 582, 824 S.E.2d 217 (Ct. App.
2019) (sale of optional liability waivers were merely incidental to the rental of tangible personal
property, thus the rentals were the true object of the transactions); Boggero v. S.C. Dep’t of
Revenue, 414 S.C. 277, 777 S.E.2d 842 (Ct. App. 2015) (determining the true object of the
transactions at issue was for the rental of portable toilets and not waste removal services); see also
S.C. Private Letter Ruling #20-3 (the true object of the transaction was for a mixing service and
not the sale of concrete).

ADMISSIONS TAX

Code Section 12-21-2420 imposes a 5% admissions tax “upon all paid admissions to all places of
amusement within this State. . . .” Code Section 12-21-2410 defines admissions as “the right or
privilege to enter into or use a place or location.”

A dinner attraction show is clearly a place of amusement for which a fee is paid to enter into or
use. While the admissions tax statute defines the word “admissions,” it does not elaborate as to
what constitutes “paid admissions.” Therefore, we must determine what is the paid admission.

“Administrative interpretation of statutes, consistently followed by the agencies charged with their
administration and not expressly changed by Congress, are entitled to great weight.!°” When, as
in this case, the construction or administrative interpretation of a statute has been applied by the
agency charged with administering said statute for a number of years and the construction or
interpretation has not been changed by the legislature, a strong presumption is created that such
interpretation or construction is correct.'!' The Department holds the longstanding policy to only
tax, for admissions tax purposes, that portion of a package deal that represents the price of the
admissions. (A package deal is one that includes the purchase of tangible personal property and
admissions to a place of amusement.)

CONCLUSION:

The charge by a dinner attraction show for a ticket is subject to both the sales tax and the admission
tax. However, dinner attraction shows will only be required to remit the sales tax on that portion
of the charge representing the price of the meal and the admissions tax on that portion of the charge
representing the price of the admissions, provided the price breakdown is reasonable and supported
by the records of the taxpayer.

In the event the taxpayer’s records do not support the amount reported and remitted for sales tax
or admissions tax, the Department may employ any proper and reasonable audit methods for the
purpose of determining tax liability.'”

SOUTH CAROLINA DEPARTMENT OF REVENUE

W. Hartley Pdwell, Diréctor

November. ZF, 2025

Columbia, South Carolina

10 McEntire Produce, Inc. v. South Carolina Dep’t of Revenue, 439, S.C. 238, 256, 886 S.E.2d
697, 707 (Ct. App. 2023) (quoting Marchant v. Hamilton, 279 S.C. 497, 309 S.E. 2d 781 (1983)).
'l See Charleston County Assessor v. University Ventures, LLC, 427 S.C. 273, 289, 831 S.E.2d
412, 420 (2019) (citing Tiwan Fertilizer Company v. South Carolina Tax Commission, 217 S.C.
354,359, 60 S.E.2d. 682, 684 (1950)). See also Ryder Truck Lines, Inc. v. South Carolina Tax
Comm’n. 248 S.C. 148, 152-153, 149 S.E. 2d. 435, 437 (1966).

12 See S.C. Code Ann. § 12-54-100.