LR 8338
Taxability of Concessions at Municipal Owned Recreation Center
February 28, 2025
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 December 3, 2024.
The facts as presented in your letter ruling request are summarized as follows:
Applicant sells concessions at the city aquatics center and various recreational events sponsored by the city's Parks and Recreation Department. In addition, the city sells merchandise, such as t-shirts, at the municipal golf course. All proceeds of sales are for city benefit. The city has not entered into any revenue sharing agreements related any of these sales.
ISSUE:
Must sales tax be collected on sales of concessions and other items sold by the city?
RESPONSE:
No. Sales tax need not be collected on sales of concessions and other items sold by the city.
Section 144.020.1, RSMo, provides: "A tax is hereby levied and imposed [...] upon all sellers for the privilege of engaging in the business of selling tangible personal property or rendering taxable service at retail in this state." Section 144.010.1, RSMo, also provides for the imposition of a tax on the sale of tangible personal property.
Sales of tangible personal property are subject to tax unless a specific exemption applies, and tax exemptions and exclusions are strictly construed against the taxpayer, with any doubt to be resolved in favor of the tax.
Section 144.020.1(2), RSMo, imposes a sales tax on fees paid for admission and seating or paid in any place of amusement or recreation, games, or sporting event.
The Missouri Constitution, however, provides that the general assembly shall not have power to impose a sales or use tax upon the use, purchase or acquisition of property paid for out of the funds of any county or other political subdivision. Mo. Const. Art. 3, § 39 (10).
Section 144.030.2(17), RSMo, provides, that:
[A]ll amounts paid or charged for admission or participation or other fees paid by or other charges to individuals in or for any place of amusement, entertainment or recreation, games, or athletic events ... owned or operated by a municipality or other political subdivision where all the proceeds derived therefrom benefit the municipality or other political subdivision ... [are not subject to sales taxes.]
The exemption contained in Section 144.030.2(17), RSMo, applies to all fees paid by individuals in a place of amusement and therefore exempts the Applicant's sales of tangible personal property. City of Jefferson v. Director of Revenue, 1992 WL 390471 (AHC No. 92-000424RV).
Therefore, pursuant to the Missouri Constitution and Section 144.030.2, RSMo, sales tax need not be collected on proceeds of sales of concessions at Applicant' sporting events.
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 Senior Counsel Kent L. Brown, General Counsel's Office, Post Office Box 475, Jefferson City, Missouri 65105-0475, phone (573) 751-0961.
Sincerely,
Trish Vincent