On The Floor

Is your county ready for the new sales tax on services?

Counties now required to collect sales taxes on a variety of services

Effective July 1, 2018, a number of new services are subject to the sales tax in Kentucky including facility/event admission fees, landscape services, janitorial services, pet care services, personal property repair, etc. In addition to private businesses and nonprofit organizations, counties are required to collect sales taxes on those services covered under the new law.   

“Having reviewed HB487 as it relates to sales tax, and after consultation with the Kentucky Department of Revenue (DOR) and the Kentucky Chamber of Commerce, it appears that Kentucky local governments are now required to charge sales tax for certain services,” said Rich Ornstein, KACo Attorney. 

For example, if your county offers shelter rentals for picnics or charges to use a public swimming pool or tennis court, the 6 percent sales tax must be collected.  If your county does not currently have a sales and use tax account, it will need to apply for one on the Department of Revenue website.

The Department of Revenue has launched a website with FAQs, taxanswers.ky.gov, where users can learn more about what the new sales tax applies to and ask more specific questions. The site promises that a support team member will answer questions within two business days.


SERVICES SUBJECT TO SALES TAX

Extended warranty services – sale of extended warranty services to repair, support, or maintain tangible personal property or digital property that is taxable to the warranty holder.

Facility/event admission fees – charges for the right of entrance to a display, program, sporting event, music concert, performance, play, show, movie, exhibit, fair, or other entertainment event or amusement. For example:

  • Bowling centers,
  • Skating rinks,
  • Health spas,
  • Swimming pools,
  • Tennis courts,
  • Weight training facilities,
  • Fitness and recreational sports centers, and
  • Golf courses (both public and private).

NOTE: Admission to racetracks taxed under KRS 138.480, historical sites exempt under KRS 139.482, and the part of admissions to county fairs exempt under KRS 139.470 are exempt from sales tax by statute.

Indoor skin tanning services – including tanning booth, tanning bed and spray tanning.

Janitorial services – including residential and commercial cleaning; carpet, upholstery and window cleaning.

Labor charges for installation/repair – labor for the installation or repair of personal property, digital property or services sold. Note – labor associated with the repair of fixtures to real property (e.g. HVAC unites, water heaters, plumbing fixtures, etc.) are not subject to tax.

Landscape services – including lawn care and maintenance, tree trimming, pruning or removal, landscape design and installation, landscape care and maintenance, snow plowing and removal, etc.

Limousine services – must be collected if driver is provided.

Laundry/dry cleaning services – includes industrial laundry services, linen supply services and non-coin operated laundry and dry cleaning services.

Non-medical diet and weight reducing services

Pet care services – including grooming, boarding, pet sitting and pet obedience training.

Rentals of campsites – taxable accommodations now includes campsites, campgrounds and Recreational Vehicle (RV) Parks; rentals for a continuous period of 30 days or more to a person are excluded.

Veterinary services – includes veterinary services for small animals, but does not include veterinary services provided for equine, cattle, swine, sheep, goats, llamas, alpacas, ratite birds, buffalo, and cervids. 

Contact Us

https://onthefloor.kaco.org