Children's Party Packages Taxable in Virginia

Thursday, January 30th, 2014

 
 
Share
Link
Virginia
General

The Virginia Tax Commissioner recently released a ruling that charges for children's birthday party packages were subject to tax.

The taxpayer operated a children's amusement center that had inflatable structures for children to play on. The taxpayer sold children's party packages. These packages included a private party room, a party coordinator's services, pizza, cake, drinks, invitations, disposable utensils and plates, a t-shirt for the birthday child, and play time on the structures. The party coordinator set up the party, greeted the hosts and guests, coordinated party games, cleaned up, and helped carry presents.

Virginia taxes sales of tangible personal property, including sales of prepared food. The sales price of tangible personal property is the amount subject to tax. The "sales price" is "the total amount for which tangible personal property" is sold. Although admissions are not generally subject to tax, a "cover charge" that entitles the customer to food, drinks, or other tangible property is taxable as the sales price of tangible personal property.

The Commissioner determined that the charge for the packages was taxable as the sales price of tangible personal property. Because the charge included the provision of taxable food and beverages, it did not matter whether the primary purpose of the sale was the taxable items. The charge for the party package was therefore subject to tax.

http://www.policylibrary.tax.virginia.gov/OTP/Policy.nsf/ccd0d2ea93db9ba485256968006a39ed/218a01ef818393e085257c6d004e2db8?OpenDocument


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Texas Exempts Boats and Motors Temporarily Used in the...

Wednesday, June 26th, 2019 -Texas has recently passed a bill creating an exemption for boats and motors purchased for use outside of the s...

Data Survey Services Not Taxable in South Carolina

Monday, June 24th, 2019 -The South Carolina Department of Revenue recently ruled that business data survey services were non-taxable pr...

Senior Center Cafeterias are Taxable in Missouri

Friday, June 21st, 2019 -Missouri's Director of Revenue recently issued a letter ruling taxing the sale of cafeteria food by a 501(c)(3...

Hot-Air Balloon Rides in Missouri are Taxable When...

Wednesday, June 19th, 2019 -Missouri recently released a letter ruling addressing the taxation of hot-air balloon rides. The taxpayer was ...

Nevada Exempts Certain Medical Equipment

Monday, June 17th, 2019 -Effective July 1, 2019, Nevada will exempt durable medical equipment, oxygen delivery equipment, and mobility ...

Participatory Sports are Taxable in New York

Friday, June 14th, 2019 -The New York Division of Tax Appeals recently denied a refund claim made by an instructor-led indoor spin clas...