Recommendation Concerning Technical Assistance Advisement (TAA) 16A-020 relating to sales and use tax liability for fees paid by the library café concessionaire
That the Board accept the following information concerning TAA 16A-020 from the Florida Department of Revenue (DOR) relating to sales and use tax liability for fees paid by the library café concessionaire:
On July 19, 2016, the County entered into an agreement with Solo Caffe for the provision of food and drink concessionaire services within the Downtown Main Library Facility. Per the terms of the agreement, the concessionaire will pay the County a monthly fee equal to a percentage of the net sales, which is defined as gross sales less applicable sales taxes.
On October 12, 2016, the County Attorney’s Office requested a TAA from the Florida DOR's Technical Assistance and Dispute Resolution Division to determine whether the DOR would consider the monthly fee paid pursuant to the agreement taxable as payment for a license to use space. The County asserted that the agreement was not taxable where the fees would be paid as consideration for an exclusive license to provide a service, and if construed as a monthly lease payment, the fees would be exempt from sales tax where the food and drink concessionaire services are provided within the premises of a publicly owned recreational facility pursuant to §212.031(1)(a)(10), Florida Statutes.
In response, on December 12, 2016, the DOR issued a TAA concluding that the monthly fee paid to the County is exempt from sales and use tax where the County’s public library facility qualifies as a publicly owned recreational facility as defined by statute.