Which Nebraska hunting-access, guide, exclusive-land, and animal fees were subject to sales tax?

Plain-English summary

A charge for nonexclusive access to land for hunting was a taxable admission. Hunting was recreation, and the landowner retained the right to allow other people onto the property rather than ceding access control to the hunter.

The landowner had to obtain a sales-tax permit and collect Nebraska state and local sales taxes.

Guide and animal charges

A guide fee charged by the person selling the hunting admission entered the taxable gross receipts, even if someone else supplied the guide service. The service was necessary to complete the seller's admission sale.

A hunter who contracted separately with an independent guide received a nontaxable guide service under the GIL.

An extra charge based on the type or size of animal taken—such as a per-turkey or per-deer fee—also entered the taxable admission price. The seller was not treated as selling the animal.

Exclusive rights to the land

When a guide bought exclusive hunting rights and received the right to control who could access the land, the landowner-to-guide transaction was a lease or rental rather than an admission and was not taxable.

The guide's later charges to hunters were taxable admissions, so the guide had to obtain a permit and collect tax.

Common questions

Q: Was a yearly hunting-access charge taxable?

A: Yes, when the landowner retained control over who else could enter.

Q: Was a separately hired guide taxable?

A: No. The result changed when the admission seller imposed the guide charge as part of the admission sale.

Q: Was an exclusive hunting-rights lease taxable as an admission?

A: No. Ceding access control to the lessee brought it within the lease-or-rental exclusion.

Q: Were trophy or per-animal charges taxable?

A: Yes. They were part of the admission seller's gross receipts.

Citations and references

• Neb. Rev. Stat. § 77-2703(1) — tax on gross receipts from admissions
• Neb. Rev. Stat. § 77-2701.55 — admission, recreation, and lease-or-rental exclusion
• Neb. Rev. Stat. §§ 77-2701.16(1) and 77-2701.35 — gross receipts and sales price
• Neb. Rev. Stat. §§ 77-2704.10 and 77-2704.63 — admission exemptions that did not apply
• Nebraska Sales and Use Tax Regulation 1-044.03 — tax-included admission price
• Nebraska GIL 1-14-4 — hunting-access scenarios

Source

• Landing page: https://revenue.nebraska.gov/about/legal-information/general-information-letters-gils
• Original PDF: https://revenue.nebraska.gov/sites/revenue.nebraska.gov/files/doc/legal/gil/GIL01-14-04_Admissions_Hunting.pdf

Original ruling text

GIL 1-14-4 Sales and Use Tax: Admissions – Hunting
This guidance document is advisory in nature but is binding on the Nebraska Department of Revenue
(Department) until amended. A guidance document does not include internal procedural documents that only
affect the internal operations of the Department and does not impose additional requirements or penalties on
regulated parties or include confidential information or rules and regulations made in accordance with the
Administrative Procedure Act. If you believe that this guidance document imposes additional requirements or
penalties on regulated parties, you may request a review of the document.
This guidance document may change with updated information or added examples. The Department
recommends you do not print this document. Instead, sign up for the subscription service at
revenue.nebraska.gov to get updates on your topics of interest.
December 18, 2014
Dear XXXX:
We have received your questions regarding the applicability of the sales tax on charges for the right to hunt.
Because of the nature of the questions asked, we are issuing this reply as a General Information Letter (GIL).
GILs address general questions; provide analysis of issues; and direct taxpayers to the Nebraska statutes,
Nebraska Department of Revenue (Department) regulations, revenue rulings, or other sources of information to
help answer a question. A GIL is a statement of current Department policy, and taxpayers may rely on the
Department to follow the principles or procedures described in a GIL until it is rescinded or superseded. You
may also find current regulations, revenue rulings, information guides, taxpayer rulings, and other GILs that
may be helpful to you at revenue.nebraska.gov.
You pose four different scenarios for analysis and answer. This GIL addresses them consecutively.

1. If a landowner charges $1,500 for the right to come onto the property during the calendar year
   for the right to only hunt, is this a taxable admission?
   Response: Yes, a charge for access to land to hunt is a taxable admission under Nebraska law. Neb.
   Rev. Stat. § 77-2703(1) provides that “gross receipts from the sale of admissions” is subject to sales
   tax. Neb. Rev. Stat. § 77-2701.55(1) defines an admission as “the right or privilege to have access to a
   place or location where amusement, entertainment, or recreation is provided to an audience,
   spectators, or the participants in the activity.” Subsection (2)(c) defines recreation as “a sport or
   activity engaged in by participants for purposes of refreshment, relaxation, or diversion of the
   participants.” However, 77-2701.55(3) provides that “[a]dmission does not include the lease or rental
   of a location, facility, or part of a location or facility if the lessor cedes the right to determine who is
   granted access to the location or facility to the lessee for the period of the lease or rental.”
   Given the limited facts presented in your question, it appears that the owner of the land does not cede
   the right to determine who is granted access to the hunter. Rather, it seems that the landowner has
   retained the right to grant others access to his or her land for the purpose of hunting, or for other
   recreational or commercial purposes. Under these facts, the landowner has not rented or leased the
   land to the hunter.
   Based on the statutory definitions, hunting is “recreation” because it is a “sport or activity engaged in
   for purposes of refreshment, relaxation, or diversion of the participants” (the hunters). Therefore the
   charges to hunters for access to a particular place for purposes of hunting are within the definition of
   admissions and are subject to Nebraska state and local sales taxes.

Finally, none of the exemptions from sales tax on admissions found in Neb. Rev. Stat. §§ 77-2704.10
or 77-2704.63 (admissions to school events, statewide athletic events, and youth sports events and
leagues) apply in this situation. Therefore, the $1,500 charge is a taxable admission. The landowner
should obtain a permit by filing a Nebraska Tax Application, Form 20, and collect and remit sales tax
to the Department. Because it is an admission, Reg-1-044.03 allows the sales tax to be included in the
total sales price as long as the price before tax is separately shown on the invoice or receipt or posted
conspicuously on the premises.

2. If a landowner also offers the service of a guide for an additional charge of $250, is the
   additional charge for the guide taxable?
   Response: Yes, the additional charge for the services of a guide is also subject to sales tax. Neb. Rev.
   Stat. § 77-2703(1) imposes the sales tax on the “gross receipts from the sale of admissions.” Gross
   receipts is defined in Neb. Rev. Stat. § 77-2701.16(1) as “the total amount of the sale or lease or rental
   price.” “Sales price” is defined in Neb. Rev. Stat. § 77-2701.35 to include “charges by the seller for
   any services necessary to complete the sale.” Therefore, the total amount charged by the landowner is
   subject to sales tax as an admission. This includes the charge for the guide, whether the guide is the
   landowner or someone else hired by the landowner. The entire charge is part of the gross receipts for
   the sale of the admission.
   This is true even though guide services are not one of the services that are subject to tax under
   Nebraska law. If a hunter separately contracts for a guide, the charge by the guide for that service
   would not be subject to tax. However, when the charge is made by the person who is granting the
   admission, the entire charge is subject to sales tax as part of the gross receipts for an admission.
3. If a guide purchases exclusive rights to the land for hunting purposes is this charge taxable? If
   the guide then sells his guide services to one or more individuals, is the charge for his service
   taxable?
   Response: The transaction between the landowner and the guide is not subject to sales tax. This
   transaction falls within the exclusion of leases or rentals from the definition of “admission” provided
   in § 77-2701.55(3) (quoted in its entirety above). Therefore, the transaction between the guide and the
   landowner is not an admission and is not subject to sales tax.
   However, the charges by the guide to his or her customers are admissions and subject to sales tax. The
   guide, like the landowner in question #1, must obtain a sales tax permit and collect and remit sales tax
   to the Department.
4. If a landowner or guide charges an additional fee, based on the type or size of the animal taken
   on the land, is the additional fee taxable? For instance $100 per turkey or $500 per deer.
   Response: Yes, the additional fee is subject to sales tax. This is essentially the same analysis as
   provided in the response to question #2. The extra charge for the birds or animals is like the extra
   charge for the guide service. It is part of the gross receipts for selling the admission and is subject to
   sales tax. The landowner or guide would not be considered to be selling the bird or animal.
   Kim Conroy
   Tax Commissioner