Generally, the term “amusement and recreation services” includes all activities in which the customer is an active participant rather than merely an observer or passive participant. These activities include golf, billiards, skating, bowling, swimming, bungee jumping, skiing, basketball, racquetball, handball, squash, tennis, and day trips for sightseeing purposes. Also included are charges for providing related facilities, such as courts, ski lifts, and pools. Amusement and recreation services are subject to the retailing classification of the business and occupation (B&O) tax. In addition, retail sales tax must be collected.
Please note, charges made for providing the opportunity to dance are generally taxed as an amusement and recreational service. However, effective October 1, 2013 through July 1, 2017 such charges are excluded. Please see the Special Notice, Cover Charges for Opportunity to Dance Reclassified until July 1, 2017.
The term “amusement and recreation services” does not include instructional lessons for a taxable activity, such as tennis lessons or swimming lessons. Income derived from providing lessons is subject to the service and other activities classification of the B&O tax. Retail sales tax is not collected. Also not included are activities where the customer is an observer, such as a baseball game or a concert, and most activities where the customer is a passive participant, such as a carnival ride. Income received from these activities is subject to service and other activities B&O tax.
“Day trips for sightseeing purposes” (sight-seeing tours lasting less than 24 hours) are subject to retailing B&O tax and retail sales tax must be collected. However, day trips with a specific educational purpose or transport a person from one point to another are not taxable in this manner. Day trips with an educational purpose are subject to B&O tax under the service and other activities classification, while trips that transport persons from one point to another are subject to public utility tax.
For further information on the taxability of amusement and recreation services, see WAC 458-20-183. For further information on the taxability of transportation services and guided trips and tours, see WACs 458-20-179, 458-20-180, and 458-20-258, and RCW 82.04.050.