Federal law prohibits taxing fees charged for traveling on navigable waters. This includes activities such as:
- Lake cruises
- Jet boating trips
- Rafting
- Fishing excursions
- Parasailing
Tangible personal property
The sale of tangible personal property separately stated from cruise or trip fees is taxable. Examples include:
- The portion of a fee for food or beverage sales while on a dinner cruise
- Sales of tangible personal property that occur while on navigable water (e.g., clothing, souvenirs, food, rental of fishing equipment)
Renting out tangible personal property without supplying an operator is a bare rental, not a travel activity. Collect sales tax on the bare rentals of all watercraft. See Renting and Leasing.
Examples
- Boats
- Canoes
- Kayaks
- Paddleboards
- Personal watercraft (e.g., Jet Ski®)
- Safety equipment
- Diving equipment