Are admission charges for Cirque du Soleil's theatrical acrobatic performances exempt from New York's admissions tax as live circus performances?

Plain-English summary

Cirque du Soleil America asked whether admission charges to its shows -- at the time, "Alegria," a theatrical production combining acrobats, gymnasts, trapeze artists, and clowns with elaborate sets, lighting, costumes, original music, and a narrative storyline exploring themes like the transformation of political power -- qualify for New York's exemption from the sales tax on admission charges. Each show takes roughly two years to develop, involving an entire creative team (artistic director, choreographer, composer, costume and set designers) building a cohesive theatrical experience around a chosen theme, with performers evaluated on technical skill, movement, acting, and personality, not just acrobatic ability. Cirque du Soleil markets its shows as "Re-inventing the Circus," and its US touring performers receive visas as circus performers.

New York's admissions tax has long exempted "dramatic or musical arts" performances -- but a 1977 court decision (involving Ringling Bros. and Barnum & Bailey) held that this exemption only covers performances where dramatic or musical elements genuinely predominate over traditional circus elements like acrobatics and clowning; a show that's fundamentally still a circus doesn't qualify just because it adds theatrical polish. Applying that precedent here, the Department found Cirque du Soleil's traditional circus elements (acrobats, gymnasts, trapeze artists, clowns) still predominate over its dramatic and musical elements, so the older "dramatic or musical arts" exemption wouldn't apply on its own.

But the law had just changed. Effective December 1, 1997, the New York legislature amended the admissions tax statute to add a brand-new, separate exemption specifically for live circus performances -- distinct from, and broader than, the dramatic-or-musical-arts exemption. Since Cirque du Soleil's performances qualify as live circus performances under this new provision, its admission charges became exempt from New York's admissions tax starting December 1, 1997, regardless of how the older dramatic-arts predominance test would come out.

What this means for you

Circus, cirque-style, and hybrid theatrical-acrobatic performance companies

You no longer need to argue that your show's dramatic or musical elements "predominate" over its circus elements to get an admissions tax exemption -- as of December 1, 1997, live circus performances have their own standalone exemption, separate from the dramatic/musical arts test.

Venue operators hosting circus, arena, or hybrid performance shows

If you sell tickets to a live circus performance (even a theatrically elaborate one with storylines, original scores, and elaborate sets), confirm whether the December 1997 statutory change applies to your specific event -- it may mean you no longer need to collect admissions tax on those tickets.

Accountants and tax professionals

This ruling illustrates a straightforward statutory-override scenario: the Ringling Bros. predominance test (from a 1977 case published as TSB-H-78(16)S) remains good law for the general dramatic-or-musical-arts exemption, but Chapter 389 of the Laws of 1997 created an independent, non-overlapping exemption for live circus performances that doesn't require any predominance analysis at all.

Common questions

Q: Does a circus performance need to be mostly "dramatic" or "musical" to be tax-exempt?
A: Not anymore, for performances after December 1, 1997 -- live circus performances have their own separate admissions tax exemption regardless of how much theatrical or musical content is layered on top.

Q: Would this same show have been exempt before December 1, 1997?
A: No -- before the new exemption took effect, this ruling found the show's traditional circus elements still predominated over its dramatic/musical elements, so it wouldn't have qualified under the older dramatic-or-musical-arts exemption alone.

Q: What counts as a "live circus performance" under the new exemption?
A: This ruling doesn't set out a detailed definition beyond finding Cirque du Soleil's acrobat/trapeze/clown-based show qualifies; a case-by-case determination would be needed for other shows.

Q: Does this ruling apply to my performance venue or show?
A: Not automatically. An Advisory Opinion binds the Department only for the taxpayer and facts it was issued to, and it can't be relied on by anyone else. Whether your specific show qualifies as a live circus performance depends on its own facts.

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1998.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a98_1s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-98(1)S
Sales Tax

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO.S971118A

On November 18, 1997, the Department of Taxation and Finance received a
Petition for Advisory Opinion from Cirque du Soleil America, Inc., 8400 - 2nd
Avenue, Montreal, QC, H1Z 4M6.
The issue raised by Petitioner, Cirque du Soleil America, Inc., is whether
the admission charges for performances presented by Petitioner are exempt from
New York State and local sales taxes on admission charges.
Petitioner submits the following facts as the basis for this Advisory
Opinion.
Petitioner has from its beginnings tried to create a new form of art, a new
type of theater-circus. Its first shows were entitled Re-inventing the Circus,
New Experience and Saltimbanco. The word Saltimbanco comes from the French word
Saltimbanque, which is defined as a street performer, artist, singer or dancer.
"Alegria" is currently one of the shows Petitioner is presenting. Like all
of Petitioner's shows, Alegria features acrobats, gymnasts, trapeze artists and
clowns in a theatrical setting, complete with sets, lights, costumes, music and
choreography. Petitioner's shows do not include animals. Alegria is a Spanish
word that expresses elation, jubilation and exhilaration. The story line links
the acts, which feature a collection of characters such as court jesters, hobos,
aristocrats and children who define the concept of power and transformation.
Alegria questions the transformation of power through time from the old
monarchies to the modern democracies, from the kings to the presidents.
The theme of Alegria is "The fools have lost their king." At the beginning
of the show a potbellied hunchbacked clown takes the audience into the fourth
dimension.
Then the lighting changes as well as the music.
It carries a
nostalgic note, and the audience sees the old aristocracy trying to keep their
world how it used to be and the young ones trying to revolutionize it into a new
world.
It is also reflected in the costumes where the audience sees the old
birds representing the old aristocracy in very elaborate costumes and the new
ones, the young birds, trying to push the old aristocracy away. The costumes of
the young birds are simpler and not as elaborate. The set is dominated by a grid
dome which looks like a half-rotunda, a mezzanine of sorts.
The music is
everywhere, it haunts the stage and then the audience hears the voice of the
singer.
The audience is left to wonder in which language she is singing,
French, English, Spanish, Italian or gibberish sounds of those times.
Petitioner's shows require extensive planning. The planning for each show
starts two years before its premiere. Meetings are held with the different
members of the creative team to brainstorm, find new concepts and new ideas and
set forth possible themes and storylines. The creative team includes the artistic
director, choreographer, composer, costume designer, set designer, lighting
designer and sound designer.

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From the meetings a few themes are retained to be developed as the focus
of the show. The concept research assistant then searches for any information
on the themes: from costumes to colors, from the music to the instruments used,
from the financial stability of the era to its work ethic and from the
architecture to the language spoken.
The same creative team takes the research and decides from the point of
view of artistic flexibility and innovation, and each with a view to his or her
own specialty, which theme will be the thread that weaves and entwines itself
through all the aspects of the show. The theme, when transformed into images,
becomes the essence of the show.
Each member of the creative team then creates his or her plans and models,
determines the musical instruments to be used and the types of singer and
dancers, based on the chosen theme. At this time, the type of dance numbers,
acrobatic numbers and comedy numbers which will best fit the creative plan and
the storyline are determined so that the music and the performers will present
the theme in music, dance, acrobatics and humor.
Dancers, singers, artists and acrobats are evaluated and chosen based on
the four criteria of technical, theatrical, movement (dance) and personality.
While the technical ability of an artist is extremely important, so is his or her
ability to move and dance, to act and become a character, to show happiness and
sadness, fear and excitement. The manner in which the artist interacts with the
other performers, his or her ability to communicate with the singer and to
present a whole theatrical show and not just a solo performance are also
critical.
During the training phase, each artist participates in workshops that
include theater, dance movement, physical expression, mask, mime and rhythm. The
choreographer and artistic director during these workshops explore the
personality of each artist to develop characters out of the sketches for that
character.
The costume designer brings the characters alive with the designs, colors
and materials which are chosen for the costumes. The set designer creates the
stage as an environment for the artists to move through to make the Big Top and
its structure part of the set design and theme. The composer creates the sounds
that envelop the characters and animate the show. The composer imagines sounds
that breathe with the artists' movements.
The score creates a cohesion that
links a series of diverse acts. While the stage direction sets the tone and the
atmosphere for the show, the choreographer melds the energy of the acrobatics
into the fluidity and expressiveness of dance.
Lighting direction helps to
create the ambiance and atmosphere of the show and is linked directly to how the
space is used. The lighting is also used to direct the eyes, influence the
perceptions and suggest ideas to the audience.
The theme of the show is the connection between the scenes of the show.
The theme is designed to create and maintain a magical atmosphere that is
uninterrupted by the need to take down and put up new equipment. The accessories,
the costumes, the artists dancing, singing and moving about the stage, tell a
continuing story which is based on the theme. The estimated preparation time for
every one minute between scenes is two days. This preparation time is required

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to assure that the transition between scenes becomes part of the show and
maintains the show's theme.
Petitioner's show is a work in progress. The original dancers and singers
as well as the replacement artists become part of the show and their growth and
change are reflected in the growth and change of the show. The creative team
continually monitors the show and provides ongoing advice to assure that the
theme and storyline of the show are retained and that new and replacement artists
are integrated into the show.
Petitioner's show is a unique experience because
of the total creative team, and all of the artists who together make and create
the dramatic, theatrical event.
As part of its Petition, Petitioner furnished a copy of a video tape
entitled "Saltimbanco's Diary: Making of Saltimbanco" which includes clips of
actual performances and features, among other things, trapeze artists and
acrobats and illustrates the results of these production aspects in a final show.
The tape illustrates the choreography, lighting, music, acting, etc. as it
pertains to Petitioner's shows.
Petitioner’s shows have been billed as “Re-inventing the Circus.”
Performers in Petitioner's United States tour ensemble receive their visas as
circus performers.
Applicable Tax Law
Section 1101 of the Tax Law provides, in part:
(d) When used in this article for purposes of the tax imposed
under subdivision (f) of section eleven hundred five, the following
terms shall mean:
*

*

*

(5) Dramatic or musical arts admission charges. Any admission
charge paid for admission to a theatre, opera house, concert hall or
other place of assembly for a live dramatic, choreographic or
musical performance.
Section 1105(f)(1) of the Tax Law as recently amended by Chapter 389 of the
Laws of 1997, effective December 1, 1997, provides for the imposition of sales
tax as follows:
(1) Any admission charge where such admission charge is in
excess of ten cents to or for the use of any place of amusement in
the state, except charges for admission to race tracks, boxing,
sparring or wrestling matches or exhibitions which charges are taxed
under any other law of this state, or dramatic or musical arts
performances, or live circus performances, or motion picture
theaters, and except charges to a patron for admission to, or use
of, facilities for sporting activities in which such patron is to be
a participant, such as bowling alleys and swimming pools.
For any
person having the permanent use or possession of a box or seat or a
lease or a license, other than a season ticket, for the use of a box

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or seat at a place of amusement, the tax shall be upon the amount
for which the similar box or seat is used or reserved by the holder,
licensee or lessee, and shall be paid by the holder, licensee, or
lessee. (emphasis added)
Opinion
Under Ringling Bros. and Barnum & Bailey Combined Shows, Inc. v. New York
State Tax Commission and The City of New York, Sup Ct, New York County, August
10, 1977, Postel, J., (published by the Department of Taxation and Finance as
TSB-H-78(16)S) the exemption for admission charges to dramatic or musical arts
performances pursuant to Section 1105(f)(1) of the Tax Law was held to apply, on
its face, to admissions to performances of the kind which are commonly regarded
as part of the dramatic or musical arts and which are customarily given in
theatres, opera houses, concert halls and similar places. The Court concluded
that in order to qualify for exemption under Section 1105(f)(1) of the Tax Law,
the performance must be predominantly one of the dramatic or musical arts, and
that traditional circus performances are not within the definition of the term
"dramatic or musical arts," as used in that Section.
In the instant case, while Petitioner's performances do contain some
elements of the dramatic or musical arts, it would not seem that these elements
predominate over the other traditional elements that are more characteristic of
a circus (i.e., acrobats, gymnasts, trapeze artists, clowns, etc). See Ringling
Bros. and Barnum & Bailey Combined Shows, Inc., supra. However, Sections 100 and
101 of Chapter 389 of the Laws of 1997, respectively, amended Sections 1105(f)(1)
and 1101(d)(5) of the Tax Law, to specifically include live circus performances
among the exhibitions, performances and amusements not subject to sales tax.
Petitioner's performances qualify as live circus performances for purposes of
Section 1105(f)(1) of the Tax Law. Therefore, effective December 1, 1997, the
admission charges for Petitioner's performances are not subject to sales tax
under Section 1105(f)(1) of the Tax Law.

DATED: January 30, 1998

NOTE:

/s/
John W. Bartlett
Deputy Director
Technical Services Bureau

The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.