Tax Commission, Auditing

Section R865-19S-33

Admissions and User Fees Pursuant to Utah Code Ann. Sections 59-12-102 and 59-12-103

Notice of Proposed Rule

(Amendment)

DAR File No.: 33849
Filed: 07/20/2010 10:47:14 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The proposed amendment will treat all transactions in the same manner as bundled transactions are treated under statute.

Summary of the rule or change:

The amendment removes language indicating that in a purchase consisting of taxable and nontaxable items, the nontaxable items must be separately stated on the invoice or the entire purchase is subject to sales tax. The standard for recording these transactions will be in the amended Section R865-19S-4. This amendment will allow the seller to separately state the nontaxable items on the invoice or be able to reasonably identify them from the books and records it keeps in its regular course of business. The amendment also makes technical changes. (DAR NOTE: The amendment to Section R865-19S-4 is under DAR No. 33848 in this issue, August 15, 2010, of the Bulletin.)

State statutory or constitutional authorization for this rule:

• Section 59-12-102
• Section 59-12-103

Anticipated cost or savings to:

the state budget:

None--The proposed amendment does not impact the amount of tax due only the recordkeeping requirements of the seller.

local governments:

The proposed amendment does not impact the amount of tax due only the recordkeeping requirements of the seller.

small businesses:

None--Sellers are currently acting within the scope of the proposed amendment. The proposed amendment will allow sellers who sell taxable and nontaxable items in a nonbundled transaction the same invoicing options as the seller of a bundled transaction.

persons other than small businesses, businesses, or local governmental entities:

None--Sellers are currently acting within the scope of the proposed amendment. The proposed amendment will allow sellers who sell taxable and nontaxable items in a nonbundled transaction the same invoicing options as the seller of a bundled transaction.

Compliance costs for affected persons:

None--Sellers are currently acting within the scope of the proposed amendment. The proposed amendment will allow sellers who sell taxable and nontaxable items in a nonbundled transaction the same invoicing options as the seller of a bundled transaction.

Comments by the department head on the fiscal impact the rule may have on businesses:

None anticipated.

Michael Cragun, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Tax Commission
Auditing
210 N 1950 W
SALT LAKE CITY, UT 84134

Direct questions regarding this rule to:

• Michael Cragun at the above address, by phone at 801-297-3907, by FAX at 801-297-3919, or by Internet E-mail at mcragun@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

09/14/2010

This rule may become effective on:

09/21/2010

Authorized by:

R. Bruce Johnson, Tax Commission Chair

R865. Tax Commission, Auditing.

R865-19S. Sales and Use Tax.

R865-19S-33. Admissions and User Fees Pursuant to Utah Code Ann. Sections 59-12-102 and 59-12-103.

[A.](1)(a) "Admission" means the right or privilege to enter into a place. Admission includes the amount paid for the right to use a reserved seat or any seat in an auditorium, theater, circus, stadium, schoolhouse, meeting house, or gymnasium to view any type of entertainment. Admission also includes the right to use a table at a night club, hotel, or roof garden whether such charge is designated as a cover charge, minimum charge, or any such similar charge.

[1.](b) This applies whether the charge made for the use of the seat, table, or similar accommodation is combined with an admission charge to form a single charge, or is separate and distinct from an admission charge, or is the sole charge.

[B.](2) "Annual membership dues paid to a private organization" includes only those dues paid by members who, directly or indirectly, establish the level of the dues.

[C.] (3) "Season passes" include amounts paid to participate in specific activities, once annual membership dues have been paid.

[D.](4) If the original admission charge carries the right to remain in a place, or to use a seat or table, or other similar accommodation for a limited time only, and an additional charge is made for an extension of such time, the extra charge is paid for admission within the meaning of the law. Where a person or organization acquires the sole right to use any place or the right to dispose of all of the admissions to any place for one or more occasions, the amount paid is not subject to the tax on admissions. Such a transaction constitutes a rental of the entire place and if the person or organization in turn sells admissions, sales tax applies to amounts paid for such admissions.

[E.](5) Annual membership dues may be paid in installments during the year.

[F.](6) Amounts paid for the following activities are not admissions or user fees:

[1.](a) lessons, public or private;

[2.](b) sign up for amateur athletics if the activity is sponsored by a state governmental entity, or a nonprofit corporation or organization, the primary purpose of which, as stated in the corporation's or organization's articles or bylaws, is the sponsoring, promoting, and encouraging of amateur athletics;

[3.](c) sign up for participation in school activities. Sign up for participation in school activities excludes attendance as a spectator at school activities.[

G. If amounts charged for activities listed in F. are billed along with admissions or user fees, the amounts not subject to the sales tax must be listed separately on the invoice in order to remain untaxed.]

 

KEY: charities, tax exemptions, religious activities, sales tax

Date of Enactment or Last Substantive Amendment: [ September 17, 2009 ] 2010

Notice of Continuation: March 13, 2007

Authorizing, and Implemented or Interpreted Law: 59-12-102; 59-12-103