LR 8145

Rooms, Meals, and Drink Provided to Joint Reconstruction Patients are Not Subject to Sales Tax

April 30, 2021

Dear Applicant,

            This is a letter ruling issued by the Director of Revenue under Section 536.021.10, RSMo, and Missouri Code of State Regulations 12 CSR 10-1.020, in response to your letter dated March 23, 2021.

            The facts as presented in your letter ruling request are summarized as follows:

Applicant operates a commercial lodging business for the purpose of providing temporary lodging to clients of a surgical center.  The only individuals who can stay at Applicant's business are guests who undergo certain joint reconstructive surgeries at the surgical center.  While recovering at Applicant's business, the guests receive physical therapy services.

Applicant does not hold itself out as offering rooms to the public, and the public cannot rent a room upon demand.  The access doors to the facility are locked at all times, and access to the building is provided to patients via card key.  There is no signage on the site indicative of a retail hotel space.


            Are receipts from sales or charges for rooms, meals, and/or drinks furnished at Applicant's business subject to sales tax?


            No, receipts from sales or charges for rooms, meals, and/or drinks furnished at Applicant's business are not subject to sales tax.

            Sales or charges for all rooms, meals and drinks furnished at any hotel, motel, tavern, inn, restaurant, eating house, drugstore, dining car, tourist camp, tourist cabin, or other place in which rooms, meals or drinks are regularly served to the public are taxable under Sections 144.010.1(13)(e), RSMo and 144.020.1(6), RSMo.

            Applicant does not hold its services for sale to the public and does not regularly serve the public.  Access to the Applicant's business is available only if a person has a certain type of joint reconstructive surgery at the surgical center.  The general public has no ability to rent a room at Applicant's business.  Therefore, Applicant's receipts for rooms, meals and drinks are not subject to Missouri sales tax.

            This letter ruling is binding upon the Department of Revenue with respect to the Applicant for three (3) years from the date of this letter and is subject only to statutory changes by the General Assembly and to changes in the interpretation of law by the courts or administrative tribunals.  If a change occurs, the taxpayer who relies upon an outdated interpretation may be subject to additional taxes, interest and penalties, which may be imposed prospectively from the date of the change.  For this reason, the interpretation set forth above should be reviewed on a regular basis.  Please note that any change in or deviation from the facts as presented will render this ruling inapplicable.

            Should additional information be needed, please contact Legal Counsel Stephen S. Krogmeier, General Counsel's Office, Post Office Box 475, Jefferson City, Missouri 65105-0475 (phone 573-751-0961), or me.


Ken Zellers