Arkansas Sales taxes Initiation fees and membership dues for recreational facilities
A sales tax assessment issued against the taxpayer for initiation fees and membership dues charged to customers for use of the taxpayer’s recreational facilities, including access to hunting lands, was upheld. The membership dues and initiation fees qualified as fees for access to amusement, entertainment, athletic, or recreational facilities within the meaning of Ark. Code Ann. §26-52-301(5) and Ark. Regs. §GR-11(A), and, therefore, were taxable. The record simply did not support a finding that the facilities did not provide refreshment, pleasure, or amusement to its members. In fact, the taxpayer’s advertisements attributed such benefits in social media posts, which the taxpayer subsequently sought to disown. The record did not support a finding that the assess charges were solely for the privilege of membership. Consequently, the initiation and membership charges were subject to Arkansas sales tax. (Arkansas Administrative Hearing Decision, Dkt. Nos. 22-342, 22-343, 22-344, 05/17/2022.)
Arkansas Sales taxes Initiation fees and membership dues for recreational facilities