Are monthly membership fees for a fitness center that ONLY offers scheduled, instructor-led training classes (no open gym access) taxable as an amusement service in Texas?

Plain-English summary

The Texas Comptroller ruled that a high-intensity interval training fitness center's monthly membership fees are not taxable as an amusement service, even though athletic and health clubs are specifically listed as amusement-service businesses under the regulations. The key fact: members can ONLY attend the facility during scheduled classes led by certified coaches — they cannot access the gym for open/unstructured workouts. Coaches lead group workouts and make individual modifications as needed; one-on-one personal training costs extra.

Athletic clubs and fitness centers are generally listed as amusement-service providers under Rule 3.298(1)(D), so gym memberships are normally taxable. But Texas Tax Code § 151.0028(a) excludes services that are "primarily instructional in nature," and the Comptroller has consistently held (citing a 2017 Comptroller's Decision, a 2001 STAR letter, and others) that the taxability turns on ACCESS STRUCTURE: a membership that buys open access to workout equipment/facilities is taxable, but a membership that buys ONLY admission to scheduled, coach-led classes — with no other facility access — is a nontaxable instructional service, even if it's still called a "membership."

What this means for you

Fitness studios and boutique gyms

If your business model requires members to attend scheduled, instructor-led classes to use your facility at all — with no separate open-gym access — your membership fees are likely nontaxable under this consistent line of Comptroller guidance, regardless of whether you call the charge "membership," "class package," or something else. The label doesn't matter; the access structure does.

Traditional gyms with open facility access

If your members can swipe in and use equipment anytime, independent of any class, your membership fees remain taxable as an amusement service — this ruling doesn't change that baseline. Consider whether separately stating charges for genuinely separate instructor-led group classes (the Jazzercise-style carve-out from STAR 200103848L) could exempt at least that portion.

Accountants and tax professionals

This ruling sits in a well-developed line of authority (Comptroller's Decisions 113,090 (2017) and 104,707 (2011), STAR 200103848L (2001), 9801164L (1998), 201808006L (2018)) — cite the specific access-structure fact pattern (scheduled-class-only vs. open access) when advising fitness clients, since that's the operative distinction across all of these rulings.

Common questions

Q: Are all gym membership fees exempt from Texas sales tax?
A: No — that would be the default taxable rule since fitness/athletic clubs are listed amusement-service businesses. This exemption applies specifically when membership buys ONLY scheduled, instructor-led class access with no separate open-facility access.

Q: Does charging extra for one-on-one personal training change anything?
A: No — one-on-one training sessions involving an instructor putting a client through a program are separately recognized as nontaxable under Comptroller's Decision No. 113,090 (2017), cited in this ruling.

Q: What if my gym offers both open access AND scheduled classes?
A: This ruling doesn't address a mixed model directly, but the cited authorities suggest separately stating charges for genuinely instructor-led group classes may exempt that portion even if general membership access remains taxable.

Q: Can another fitness business rely on this ruling?
A: No. It binds the Comptroller only as to the taxpayer and facts in this specific request and cannot be relied on by any other taxpayer, though the access-structure test it applies is well-established across multiple public rulings.

Citations and references

Statutes and rules:

• Tex. Tax Code § 151.051 (sales tax imposed)
• Tex. Tax Code § 151.010 (taxable item)
• Tex. Tax Code § 151.0101(a) (taxable services)
• Tex. Tax Code § 151.0028(a) (amusement service, education/health exclusion)
• 34 Tex. Admin. Code Rule 3.298(1)(D), (a)(2), (a)(2)(B)
• Comptroller's Decision No. 113,090 (2017); No. 104,707 (2011)
• STAR Document Nos. 200103848L (2001), 9801164L (1998), 201808006L (2018)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/201902001L

Original ruling text

February 1, 2019

RE: Private Letter Ruling No. 20181012101233

Dear **:

We issue this private letter ruling in accordance with Rule 3.1, Private Letter Rulings and General Information Letters.[1] We are responding to your request dated Oct. 3, 2018, and to additional information received by email from you on Jan. 30, 2019. Detrimental reliance relief is provided in accordance with Rule 3.10, Taxpayer Bill of Rights.

You requested guidance on the taxability of memberships in a fitness club that offers specialized fitness and sports training classes.

Facts Presented

** (Taxpayer), is a fitness center in CITY, Texas, that provides high intensity interval training services for athletes. The athletes are required to show up at scheduled times for classes led by certified coaches. The coaches instruct their athletes through a workout either as a group or, if needed, work with each individual athlete to make modifications. Taxpayer charges their athletes monthly memberships to attend the classes.

The Taxpayer indicated that the membership fees only include group training classes. The athletes have to come during scheduled class training. They cannot access the facility without attending a scheduled personal or group training session. One-on-one training results in an additional membership fee.

Question, Ruling, and Analysis

Our restatement of your question is shown below, followed by our response and analysis.

Question: Are Taxpayer’s monthly membership charges for specialized fitness training classes taxable as an amusement service?

Ruling: Taxpayer’s monthly membership charges for specialized fitness training classes are not taxable as an amusement service. Taxpayer provides a nonamusement service under Rule 3.298(a)(2) (Amusement Services).

Analysis: Texas imposes a sales tax on each sale of a taxable item in this state. Section

151.051 (Sales Tax Imposed). The term “taxable item” includes tangible personal property and taxable services. Section 151.010 (“Taxable Item”). Section 151.0101(a) (“Taxable Services”) provides a list of taxable services, which includes an amusement service. Section 151.0028 (“Amusement Services”), in part, defines an amusement service as “the provision of amusement, entertainment, or recreation.” Rule 3.298 contains a similar definition but also provides examples of amusement services and places that offer amusement services subject to sales tax. For example, athletic clubs, health clubs, and physical fitness centers are places that offer amusement services. Rule 3.298(1)(D).

Section 151.0028(a), however, excludes from the definition of amusement services “the provision of … educational or health services if prescribed by a licensed practitioner of the healing arts for the primary purpose of education or health maintenance or improvement.” Rule 3.298(a)(2) defines “nonamusement services” and provides examples of services that might ordinarily be classified as a taxable amusement service but are specifically excluded from tax because they are primarily instructional in nature or nontaxable personal services. For example, nonamusement services include instruction in sport or musical discipline. Rule 3.298(a)(2).

Comptroller’s Decision No. 113,090 (2017), the comptroller determined that a charge for a customer to participate in a personal training session is not taxable as an amusement service if the service involves one-on-one training and putting the customer through a training program. However, simply designing a training program and offering instruction on how to use the training equipment would be taxable as an amusement service. The ALJ noted that there was no disagreement between the parties that the instructor-led classes were nontaxable. See also Comptroller’s Decision No. 104,707 (2011).

STAR Document No. 200103848L (March 23, 2001) also addressed gym membership fees. The letter states that monthly charges for membership in a fitness club are taxable, but separately stated charges for fitness training that occurs in a group setting, such as a Jazzercise class, are not taxable. Additionally, STAR Document Nos. 9801164L (Jan. 7, 1998) and 201808006L (Aug. 13, 2018) explain that charges for membership in a fitness club that only offers instructor-led classes, and not open access to the facility, are charges for a service that is primarily instructional in nature are not subject to sales tax.

Taxpayer’s services are nonamusement services because they are primarily instructional in nature. See Rule 3.298(a)(2)(B). Taxpayer provides personal training services for athletes in group or individual settings. The athletes are required to show up at scheduled times for classes led by certified coaches. The coaches instruct their athletes through a workout either as a group or, if needed, individually to make modifications specific to a particular athlete. Therefore, Taxpayer’s monthly membership charges for its personal training services are nonamusement services and not subject to sales tax.

Comptroller’s Decisions and STAR documents cited can be found on the Comptroller’s State Tax Automated Research (STAR) system. The Texas Tax Code, Texas Administrative Code, and the STAR system are accessible at www.comptroller.texas.gov/taxes/.

If you have questions about this private letter ruling, please email us through our website at https://comptroller.texas.gov/web-forms/tax-help/ and reference Private Letter Ruling No. 20181012101233.

Sincerely,

Tax Policy Division – Indirect Taxes

Texas Comptroller of Public Accounts

ENDNOTE:

[1] Unless otherwise indicated, all references to “Section” are to the Texas Tax Code, and all references to “Rule” are to Title 34 of the Texas Administrative Code.