Did a Texas health club or physical fitness center have to collect sales tax on customer fees for using its weight-training facilities?

Plain-English summary

The Texas Comptroller told a business to collect tax on fees customers paid to use its weight-training facilities. Under Rule 3.298, amusement services were taxable, and subsection (a)(1)(D) classified health clubs and physical fitness centers as amusement services.

The letter did not analyze separate training, instruction, treatment, or equipment-specific charges. Its stated conclusion covered the fees for customers' use of the facilities.

What this means for you

Calling a payment a membership or facility-use fee did not remove it from tax when the facility itself was treated as a taxable amusement service. Businesses with bundled or separately stated services would need to check how current law treats each charge.

Common questions

Were customer fees for using the fitness facility taxable? Yes.

Why? Rule 3.298 treated health clubs and physical fitness centers as taxable amusement services.

Did the letter separately rule on toners, exercise tables, or strength machines? No. Those items appear in STAR's caption, but the operative letter only refers generally to weight-training equipment and facility-use fees.

Did the letter decide charges for personal training or other services? No.

Citations and references

• Comptroller Rule 3.298 — Amusement Services.
• Comptroller Rule 3.298(a)(1)(D) — cited for health clubs and physical fitness centers.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8705L0820G12

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller May 15, 1987

Gentlemen:

Thank you for your letter of April 28, 1987, concerning tax on fees you
charge for the use of your weight training equipment.

I'm enclosing a copy of Rule 3.298, Amusement Services. Amusement
services
are taxable. Under this rule, we outline certain services that are
considered
amusement services and therefore subject to tax. Please note in
(a)(1)(D),
health clubs and physical fitness centers are considered amusement
services
and are subject to tax.

You should collect tax on the fees charged your customers for the use of
your facilities.

This opinion is based upon the facts you presented. If there are
additional
or different facts, this opinion may change.

Please feel free to contact me if you have additional questions. You may
write me, call toll free 1-800-252-5555 from anywhere in Texas or phone
512/463-4600.

Sincerely,
Adina Whittemore
Tax Policy Section
Tax Administration Division