Connecticut State Department of Revenue Services

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Ruling 90-69

Dues Tax

Private clubs may require their members to spend a certain amount on food and beverage during specified time periods which are normally monthly or quarterly. The amounts actually spent are subject to sales and use tax.

If a member does not spend the required minimum amount during the allotted time period, the club charges the member for the difference. The issue arises as to whether the club should charge the sales tax or the dues tax when billing the member for the difference.

Because the unspent portion of the food and beverage requirement must be paid to the club, such payments come within the definition of "dues" set forth in Section 12-540(5) of the Connecticut General Statutes as "assessment charges to members irrespective of the purpose for which made."

LEGAL DIVISION

October 19, 1990