Which tax-exempt park-board admissions, rentals, parking fees, equipment rentals, and vending-machine sales were taxable in Texas?

Plain-English summary

The Texas Comptroller had established that the Park Board was tax-exempt and therefore did not collect tax on its sales of admissions to amusement services.

The letter classified its charges as follows:

• Park entry admissions at three listed parks were not taxable.
• Museum and fishing admissions, pavilion rental, locker rental, and bumper-boat admissions at the described facilities were not taxable.
• Vending-machine sales at the parks were taxable.
• Civic-center parking fees were taxable. When the parking lot was rented with the building, the parking fee had to be separately billed and taxed.
• Building rental was not taxable.
• Equipment rental was taxable unless the equipment had become a permanent part of the building, with a sound system given as the example.
• Furniture and other items not permanently attached to the building were taxable rentals.

Tax collected on vending sales, equipment rental, and parking fees could be reported with the Park Board's regular sales-tax return.

What this means for you

Public park and recreation boards

Exempt admission treatment did not make every receipt nontaxable. Vending, parking, and movable-equipment rentals remained taxable under this letter.

Civic-center operators

Separately state the taxable parking-lot fee when bundling it with a nontaxable building rental.

Accountants and tax professionals

Track amusement admissions, real-property rentals, movable equipment, parking, and retail sales in separate categories.

Common questions

Q: Were the listed park entry fees taxable?
A: No.

Q: Were vending-machine sales taxable?
A: Yes.

Q: Was civic-center parking taxable?
A: Yes, including when separately billed with a building rental.

Q: Was building rental taxable?
A: No.

Q: Were furniture and movable-equipment rentals taxable?
A: Yes.

Citations and references

• The letter cites no statute or administrative rule.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8410L0626D08

Original ruling text

October 11, 1984

Dear ***:

Thank you for your letter dated September 5, 1984. I unfortunately did
not receive it until yesterday.

To confirm in writing what I have already related to you by phone, the
answers to your questions regarding the taxation of various fees charged
by facilities operated by the Park Board follow.

We have established that the Park Board is a tax-exempt organization and
is therefore not required to collect tax on its sales of admissions to
amusement services.

1. Park entry admissions at PARK A are not taxable. Sales from vending
   machines are taxable.

2. Park entry fees at PARK B are not taxable. Museum and Fishing admissions
   and Pavillion rental at this facility are also not taxable. Sales from vending
   machines are taxable.

3. Park entry admissions at PARK C, as well as locker rental and bumper boat
   admissions are not subject to tax. Vending machines sales are taxable.

4. Parking fees at the CIVIC CENTER X are subject to tax. When the parking lot
   is rented with the building, you must separately bill the parking lot fee and
   collect tax on that charge. Building rentals are not taxable but equipment rental
   is taxable. The exception on equipment rentals would be equipment that has become
   a permanent part of the building, such as sound systems. Rental of furniture and
   other items that are not permanently attached to the building are taxable charges.

Tax collected on vending machine sales, equipment rental, and parking fees may
be reported in with your regular sales tax return.

This opinion is based upon the facts you presented. If there are additional or
different facts, this opinion may change.

Please feel free to contact us if you have additional questions. You may call
toll free 1-800-252-5555 from anywhere in Texas.

Sincerely,

Tax Administration Division