Were tickets to a nonprofit ballet company's performance exempt from Georgia sales tax under the temporary fine-arts exemption in effect in 2018?

Plain-English summary

A public-charity theater hosted a ballet production performed by a nonprofit organization whose mission included classical-ballet training, arts education, community outreach, and performances by racially diverse artists. The theater's box office sold tickets to the public without adding sales tax.

Admission to entertainment is ordinarily a taxable retail sale in Georgia. But from April 25, 2017 until July 1, 2020, Georgia law provided a temporary exemption for qualifying fine-arts performances or exhibitions. The performance had to be presented by, or in a facility owned by, a qualifying tax-exempt arts organization or museum, and the statute expressly included ballet as fine art.

The Department ruled that the tickets were exempt under that temporary law. The ballet qualified as fine art, the performer was a 501(c)(3) organization, and its primary mission satisfied the arts and educational requirements. Because the ruling itself gives the exemption an end date, it should not be read as stating the current tax treatment of ballet tickets.

What this means for you

Theaters and performing-arts organizations

This was a time-limited exemption, not a general rule that all fine-arts tickets are tax-free. The 2018 result depended on both the nature of the performance and the nonprofit performer's tax status and primary arts mission.

Nonprofit organizations

Tax-exempt status alone was not enough. The organization's primary mission also had to advance the arts in Georgia and provide arts, educational, and culturally significant programming for public benefit and enrichment.

Accountants and tax professionals

Use this page as historical guidance for the exemption then codified at O.C.G.A. § 48-8-3(100). The ruling says the exemption ran only until July 1, 2020, so current ticket sales require current-law research.

Common questions

Q: Were the ballet tickets taxable in this ruling?
A: No. They qualified for the temporary fine-arts admissions exemption in effect in December 2018.

Q: Why did the performance qualify?
A: Ballet was expressly included as fine art, and the performer was a 501(c)(3) organization with a qualifying primary mission centered on arts training, education, outreach, and performance.

Q: Did the theater itself need to be a nonprofit?
A: The statute could apply when the performance was presented by a qualifying organization or held in a qualifying organization's facility. Here, both the theater arrangement and the nonprofit performer were described, but the ruling focused on the performer's status and mission.

Q: Is the same exemption still in effect?
A: This ruling says the exemption applied from April 25, 2017 until July 1, 2020. It does not establish the treatment of current ticket sales.

Q: Can another theater rely on this ruling?
A: No. It is limited to the requesting taxpayer, the specific ballet performance, and the law then in effect.

Citations and references

Statutes and guidance:

• O.C.G.A. §§ 48-8-1 and 48-8-30(a) (sales and use tax imposition)
• O.C.G.A. § 48-8-2(31) (entertainment admissions as retail sales)
• O.C.G.A. § 48-8-3(100) (temporary fine-arts admissions exemption)
• Georgia Department of Revenue Policy Bulletin SUT-2017-07 (fine-arts exemption guidance)

Source

• Landing page: Georgia Sales & Use Tax Letter Rulings
• Original PDF: LR SUT-2018-14

Original ruling text

Georgia Letter Ruling Number: LR SUT-2018-14
Topic: Fine Arts
Date Issued: December 10, 2018
This letter is in response to your request for guidance on the application of Georgia sales and use tax to sales of tickets
for admission to certain performances.
Facts Presented by Taxpayer
[Redacted] (“Taxpayer”) is a political subdivision of the State of Georgia and a public charity pursuant to I.R.C. §
509(a)(1). Taxpayer is a body corporate and politic created by the Georgia General Assembly for the purpose of
acquiring, constructing, and maintaining facilities for the general purpose of promoting cultural growth, education,
and welfare. Taxpayer’s mission is to be the Southeast’s premier destination for mid-sized conventions, performing
arts, and entertainment.
To further this mission, Taxpayer owns and operates the [Redacted] (the “Theater”), a Type I, I.R.C. § 509(a)(3)(B)
public charity. The mission of the Theater is to create diverse cultural, educational and entertainment experiences that
will promote accessibility to the arts; foster community partnerships that unify the region in support of the arts; fulfill
the highest expectations of patrons, performers and employees; stimulate quality economic growth; and inspire
individuals to continually increase their knowledge, patronage and financial support of the arts. As such, Taxpayer
leases the Theater to third parties for the presentation of performances.
[Redacted] (“Performer”) is a not-for-profit, tax-exempt corporation pursuant to I.R.C. § 501(c)(3). Performer’s
mission is to maintain a world-class school that trains young people in classical ballet and the allied arts; provide arts
education, community outreach programs, and positive role models for all; and present a ballet company of African
American and other racially diverse artists who perform the most demanding repertory at the highest level of quality.
Taxpayer entered an agreement with Performer to perform a ballet production in the Theater from [Redacted] through
[Redacted] (the “Performance”).
Tickets for admission to the Performance were sold to the general public. Ticket sales were handled through the
Theater’s box office. Tickets for the Performance bear a charge for admission and do not reflect any amount of sales
tax. As such, sales tax is not being collected from customers.
Issue
Are sales of tickets for admission to the Performance subject to Georgia sales and use tax?
Analysis
Georgia levies and imposes a tax (subject to certain specific exemptions) on the retail purchase, retail sale, storage,
use, or consumption of tangible personal property, certain enumerated services, and utilities. 1 “Retail sale” means any
sale, lease, or rental for any purpose other than for resale, sublease, or subrent. The term “retail sale” includes sales of
tickets, fees, or charges made for admission to places of amusement, sports, or entertainment including, but not limited
to, any place at which any exhibition, display, amusement, or entertainment is offered to the public or any other place
where an admission fee is charged. 2
From April 25, 2017 until July 1, 2020, sales of tickets, fees, or charges for admission to certain fine arts performances
or exhibitions are exempt from sales and use tax. 3 To satisfy the requirements of this exemption, the fine arts
performance or exhibition must be performed or exhibited by, or within a facility owned by, a tax exempt 501(c)(3)
organization or a museum of cultural significance, if such organization’s or museum’s primary mission is to advance
the arts in this state and to provide arts, educational, and culturally significant programming and exhibits for the benefit
and enrichment of the citizens of this state. As used in this exemption, “fine arts” includes ballet, dance, and music
performed by a symphony orchestra. 4

O.C.G.A. §§ 48-8-1, 48-8-2(31)(A), and 48-8-30(a).
O.C.G.A. § 48-8-2(31).
3
O.C.G.A. § 48-8-3(100).
4
Id.; Georgia Department of Revenue Policy Bulletin SUT-2017-07.
1
2

Georgia Letter Ruling Number: LR SUT-2018-14
Topic: Fine Arts
Date Issued: December 10, 2018
Page 2 of 2
In this case, Taxpayer does not dispute that sales of tickets to the Performance are retail sales since the tickets are for
admission to a place where entertainment is offered. To determine whether the sales of tickets at issue fall within the
above exemption, the Department must consider the nature of the Performance as well as Performer’s status and
mission. The Performance is a ballet, which Georgia law expressly includes in the definition of “fine arts.” Thus, the
Performance is a qualifying fine arts performance. Performer is an organization exempt from taxation under I.R.C. §
501(c)(3). Further, Performer’s mission is to provide performing arts education and ballet training as well as to bring
audiences innovative, multi-cultural artistic expression. Accordingly, Performer’s status and mission satisfy the
remaining requirements set forth in the exemption.
Ruling
Because the Performance is a fine arts performance that is performed by a tax exempt 501(c)(3) organization with a
primary mission that falls within the requirements set forth in O.C.G.A. § 48-8-3(100), sales of tickets for admission
to the Performance at Taxpayer’s Theater are exempt from sales and use tax.
The opinions expressed in this ruling are based upon the information contained in your request and limited to the
specific transactions, facts, circumstances and taxpayer in question. The facts herein are those presented by the
taxpayer and the Department accepts them as true for this ruling. If the facts presented herein change, are not true,
are different, or material facts have been omitted, the conclusions reached in this ruling may change. In addition,
subsequent statutory or administrative rule changes or judicial interpretations of the statutes or rules upon which this
advice is based may subject similar future transactions to a different tax treatment than that expressed in this ruling.