Current through Register Vol. 24-06, March 15, 2024
(1)
Introduction.RCW
82.14.360 provides for a special stadium
sales and use tax that applies to sales of food and beverages by restaurants,
taverns, and bars in counties with a population of one million or more. The tax
applies only to those food and beverage sales that are already subject to the
retail sales tax. Grocery stores, mini-markets, and convenience stores were
specifically excluded from the definition of a restaurant and are not required
to collect the tax. However, a restaurant located within a grocery store,
mini-market, or convenience store is subject to this tax if the restaurant is
owned or operated by a different legal entity from the store or market. The
special stadium tax applied only in King County and was effective through
September 30, 2011.
(2)
Definitions. The following definitions apply to this section.
(a) "Restaurant" means any establishment
having special space and accommodation where food and beverages are regularly
sold to the public for immediate, but not necessarily on-site, consumption, but
excluding grocery stores, mini-markets, and convenience stores. Restaurant
includes, but is not limited to, lunch counters, diners, coffee shops, espresso
shops or bars, concession stands or counters, delicatessens, and cafeterias. It
also includes space and accommodations where food and beverages are sold to the
public for immediate consumption that are located within hotels, motels,
lodges, boarding houses, bed-and-breakfast facilities, hospitals, office
buildings, movie theaters, and schools, colleges, or universities, if a
separate charge is made for such food or beverages. Mobile sales units that
sell food or beverages for immediate consumption within a place, the entrance
to which is subject to an admission charge, are "restaurants" for purposes of
this tax. So too are public and private carriers, such as trains and vessels,
that sell food or beverages for immediate consumption on trips that both
originate and terminate within the county imposing the special stadium tax if a
separate charge for the food and/or beverages is made. A restaurant is open to
the public for purposes of this section if members of the public can be served
as guests. "Restaurant" does not include businesses making sales through
vending machines or through mobile sales units such as catering trucks or
sidewalk vendors of food or beverage items.
(b) "Tavern" has the same meaning here as in
RCW
66.04.010 and means any establishment with
special space and accommodation for the sale of beer by the glass and for
consumption on the premises.
(c)
"Bar" means any establishment selling liquor by the glass or other open
container and includes, but is not limited to, establishments that have been
issued a class H license by the liquor control board.
(d) "Grocery stores, mini-markets, and
convenience stores," have their ordinary and common meaning.
(3)
Tax application.
This special stadium sales and use tax applied only to food and beverages sold
by restaurants, bars, and taverns in King County through September 30, 2011.
The tax is in addition to any other sales or use tax that applies to these
sales. This special tax only applies if the regular sales or use tax imposed by
chapters
82.08 or
82.12 RCW applies.
(a) The tax applies to the total charge made
by the restaurant, tavern, or bar, for food and beverages. If a mandatory
gratuity is included in the charge that, too, is subject to the tax.
(b) Catering provided by a restaurant,
tavern, or bar is also subject to the tax. However, when catering is done by a
business that does not meet the definition of restaurant in subsection (2) of
this section, has no facilities for preparing food, and all food is prepared at
the customer's location, the charge is not subject to the tax.
(c) In the case of catering subject to the
tax, if a separate charge is made for linens, glassware, tables, tents, or
other items of tangible personal property that are not required for the
catering, those separate charges are not subject to the tax. However,
separately stated charges for items that are required as a part of the catering
service, such as waitpersons or mandatory gratuities, are subject to the
tax.
(4)
Examples. The following examples should be used only as a general
guide. The tax status of each situation must be determined after a review of
all of the facts and circumstances. For these examples, assume the transactions
occurred in King County prior to October 1, 2011.
(a) The Hot Bakery operates a coffee shop
where customers may purchase baked goods and coffee for consumption on the
premises. When utensils are provided with the bakery goods, the sale of bakery
goods, along with the coffee is considered prepared food. The sale of prepared
food is subject to the retail sales tax and special stadium tax. If the bakery
products are bagged or boxed without utensils, the retail sales and special
stadium taxes do not apply under the provisions of
RCW
82.08.0293. See WAC
458-20-244 Food and food
ingredients, for information about the sales of prepared foods.
(b) Charlie operates a "fast food" business.
Customers may consume the food and beverages on the premises or may take the
food "to go" for consumption elsewhere. All sales of food and beverages by this
business are subject to the special stadium tax, including the food and
beverages sold "to go."
(c) Jane
operates carts that may be set up on a sidewalk or within parks from which
customers may purchase hot dogs and beverages. The cart includes heating
facilities for preparation of hot dogs at the cart site. No seating is provided
by the business. The site location is not owned or leased by Jane. These sales
are not subject to the special stadium sales tax because the business does not
have a designated space for the preparation of the food it sells. This business
does not fit the definition of "restaurant." However, if Jane operates a mobile
food service unit selling food or beverages for immediate consumption at fixed
locations within the grounds of a stadium, arena, fairgrounds, or other place,
admission to which is subject to an admission charge, then the special stadium
tax applies.
(d) Bill operates a
combination gas station and convenience store. The convenience store sells some
groceries and also some prepared foods such as hot dogs and hamburgers.
Customers may also purchase soft drinks or coffee by the cup. None of these
sales are subject to the special stadium sales tax because of the specific
language in the statute exempting convenience stores from the tax.
(e) Peter operates a business that sells
prepared pizza. The business prepares and bakes the pizza at its premises. The
business has no seating. Customers may order the pizzas by either entering
Peter's place of business or by telephone. Customers may either take delivery
at the seller's site or the business will deliver the pizza to the customer's
residence or other site. These sales are subject to the special stadium sales
tax because the business does have a designated site and facilities for the
preparation of food for sale for immediate consumption, even though no seating
is available. The regular retail sales tax applies to these sales since these
sales are not exempt food products under
RCW
82.08.0293(2).
(f) Jack has the exclusive concession rights
to prepare and sell hot dogs within a sports facility. Customers place their
orders and take delivery of the prepared food and beverages at Jack's site in
the sports facility. Jack provides no seating that he controls. Customers
generally take the food and beverage to their seats and consume the items while
watching the sports event. Jack will also prepare hot dogs and soft drinks at
his food bar and use his employees or agents to sell these products to
customers in the stands while the sports event is in progress. All of the sales
of food and beverages by Jack are subject to the special stadium sales tax.
Jack's business operation meets the definition of "restaurant." Jack has set
aside space that he controls for the purpose of preparing food and beverages
for immediate consumption for sale to the public.
(g) Jinny operates a cafe within Abe's
grocery store, for the sale of food or beverages for immediate consumption on
the premises. Abe's grocery store is a separate entity from Jinny's cafe, and
it leases the space for the cafe to Jinny. Sales of food and beverages by Abe's
grocery store are exempt from the special stadium tax, but sales at the cafe by
Jinny are subject to retail sales tax and the special stadium sales
tax.
Statutory Authority:
RCW
82.32.300,
82.01.060(2) and
82.14.360(1).
12-01-026, § 458-20-12401, filed 12/12/11, effective 1/12/12; 10-01-050,
§ 458-20-12401, filed 12/9/09, effective 1/9/10. Statutory Authority:
RCW
82.32.300 and
82.14.080. 96-16-086, §
458-20-12401, filed 8/7/96, effective
9/7/96.