New York Determines Sales Tax Applicability for Mystery and Escape Room Admissions

• New York issued an Advisory Opinion on August 20, 2024, regarding admission charges to mystery or escape rooms.
• The petitioner charges an entry fee for groups to solve puzzles in a locked room, describing it as mentally stimulating entertainment.
• New York sales tax applies to admission charges for places of amusement.
• A place of amusement is defined as any location offering entertainment, amusement, or sports facilities.
• There is an exemption for admission charges to live dramatic or musical arts performances.
• The petitioner claims their charges should be exempt due to in-character employee participation, which they argue constitutes a live dramatic presentation.
• The Department determined that the in-character interactions do not qualify as a dramatic or musical arts performance.
• The Department concluded that the admission charges for the escape rooms are subject to sales tax under Tax Law 1105(f)(1).

Source: salestaxinstitute.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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