Tennessee has issued a notice stating that tours fall under the definition of “amusement” and are subject to sales and use tax. While amusements typically appear as places of amusement, such as amusement parks, concerts, and other shows, Tennessee also includes tours under that definition.
The first category of tours includes tours by vehicle. Included in this category are trolley tours, river cruises, and bus tours. Pub crawl tours on group bicycles probably fall under this category as well. Meanwhile, the second category of tours that are included under the definition of “amusement” are ghost tours, plant tours, pub crawls, etc.
This clarification is important for a state with a substantial amount of tourism. As the country music capital of the world, Nashville attracts many visitors who participate in these tours. However, the Department acknowledged that it is important to remember that exemptions exists to this rule. For example, tours conducted by a nonprofit, government agency, or for a Tennessee historic property are exempt from tax.
Jeanette Moffa is an attorney who concentrates on state and local taxes at Moffa, Sutton, & Donnini, P.A. She is also an adjunct professor and assistant editor to the American Bar Association’s The Sales and Use Tax Deskbook. She can be reached at 954-800-4138 or JeanetteMoffa@FloridaSalesTax.com