Tax Type
Retail Sales and Use Tax
Description
Complimentary meals and beverages served to hotel guests
Topic
Taxability of Persons and Transactions
Date Issued
11-24-1987
November 24, 1987
Re: Request for Ruling/Sales and Use Tax
Dear ********************
This will reply to your letter of October 29, 1987, in which you wish to determine the applicability of the sales and use tax to complimentary meals and beverages furnished to hotel guests.
You note in your letter that the hotel provides each registered guest a complimentary breakfast each morning. In addition, each guest is entitled to complimentary cocktails or other beverages served each evening. The cost of the food and beverages to the hotel is included in the price charged to guests for their accommodations.
Inasmuch as the cost of the food and beverages provided to guests on a complimentary basis is included in the taxable room rental charge, the hotel may purchase the food and nonalcoholic beverages (including mixers) under a resale certificate of exemption, Form ST-10. Alcoholic beverages purchased directly from the Department of Alcoholic Beverage Control are exempt from the sales and use tax under §58.1-608.17 of the Code of Virginia; however, these beverages are subject to taxes administered by the Department of Alcoholic Beverage Control.
If you have any questions, please do not hesitate to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner