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WAC 124 Restaurants, cocktail bars, taverns and similar businesses.
SOURCE DOCUMENT DETER. NO DATE OF ISSUE DESCRIPTION
WAC: 458-20-124 12/12/13 Restaurants, cocktail bars, taverns and similar businesses explains the business and occupation tax and retail sales tax applications to sales by restaurants and similar businesses. This rule has been revised to recognize Dep't of Revenue v. Bi-Mor, Inc., 171 Wash.App. 197, 286 P.3d 417 (2012). The revision also includes an explanation of the sales and use tax exemptions for products sold to restaurants that impart flavor to food during the cooking process (Chapter 13, Laws of 2013 (ESSB 5882)). 
  458-20-124   03/19/12 WAC 458-20-119 Sales by caterers and food service contractors; and
WAC 458-20-124 Restaurants, cocktail bars, taverns and similar businesses
The Department amended WAC 458-20-119 (Rule 119) and 124 (Rule 124) to recognize chapter 55, Laws of 2011 (SB5501), which provides a B&O, retail sales, and use tax exemption for meals provided without specific charge to employees of restaurants. Amended Rule 124 incorporates this legislation, and amended Rule 119 refers readers to Rule 124 for guidance on this subject.

Also removed from Rule 119 was other tax-reporting information that is addressed in other documents. For example, Rule119 provided tax reporting information regarding sales of meals in school, college, and university dining rooms and by hospitals, nursing homes, and other similar institutions. Tax reporting guidance for these sales can be found in WAC 458-20-167 Educational institutions, school district, student organizations, and private schools and WAC 458-20-168 Hospitals, nursing homes, boarding homes, adult family homes and similar health care facilities. The Department has changed the title for Rule 119 from Sales of meals to Sales by caterers and food service contractors to more accurately reflect the information retained in the rule.
  458-20-124   02/01/10 These rules all refer to resale certificates. Proposed action is to add standard language to recognize reseller permits for sales made on or after January 1, 2010.
  458-20-124   11/08/1993 Restaurants, cocktail bars, taverns and similar businesses.Effective 12/9/93
         
       
RCW: 82.04.050   1995 "Sale at retail," "retail sale."
  82.04.250   1993 Tax on retailers.
  82.08.020   1992 Tax imposed--Retail sales--Retail car rental.
  82.14.030   1989 Sales and use taxes authorized-- Additional taxes authorized--Maximum rates.
         
       
ETA 3168.2011   08/19/2011 Meal Assembly Kitchens This ETA provides guidance regarding the B&O and retail sales tax reporting responsibilities of businesses that provide menu options, purchase ingredients, and prepare the ingredients for assembly.  It addresses “meal assembly kitchens” that allow customers to assemble their own entrées, and those that assemble entrées selected by the customer.  
  3082.2009   2/2/09 Donations to meal providers
         
       
INDUSTRY GUIDES:   2004 Restaurant Guide
      2001 Tavern Guide
      06/01/2010 Restaurants & Retailers of Prepared Food
         
         
SPECIAL NOTICES:      
Subject Title Reference:      
Charcoal 08/01/2013 Sales of Charcoal Briquettes, Wood Chips, and Similar Items to Restaurants
Food & Food Ingredients 10/22/2013 Is Prepared Food More Than 75% of Your Total Food Sales? Important Tax Information
Spirits Tax 08/30/2012 Claims of Constitutional Impairment of Contract made under Initiative 1183
Food & Food Ingredients 10/31/2012 Taxability of Soft Drinks
      03/01/2012 Questions and Answers on Spirits Tax for Retailers
Food & Food Ingredients     07/25/2011 King County Food and Beverage Tax Expires
King County     07/25/2011 King County Food and Beverage Tax Expires
Carbonated Beverages 11/17/2010 Carbonated Beverage Tax Repealed
Food & Food Ingredients 05/24/2011 Restaurants Providing Complimentary Meals to Employees
Employee Meals 05/24/2011 Restaurants Providing Complimentary Meals to Employees
Carbonated Beverages     06/11/2010 Retailers Subject to Temporary Carbonated Beverage Tax
Carbonated Beverages     06/14/2010 Bottlers and Distributors Subject to Temporary Carbonated Beverage Tax
Food & Food Ingredients     07/02/2010 Determining Whether Sales Tax Applies to Sealed Beverages
Hotel Motel/ Hurricane Relief     09/22/2005 No Sales Tax Due on Purchases Made With American Red Cross Cash Assistance Cards or FEMA Debit Cards Issued to Hurricane Victims
Food & Food Ingredients/ Syrup Tax     04/14/2006 Retailers of Fountain Drinks B&O Tax Credit for Syrup Tax Paid
Beer & Wine     8/6/09 Direct Wine Sales to Consumers - New Registration and Tax Collection Requirements
      04/17/2006 Beer and Wine Sales to Retailers
Beer & Wine/ Wine Shipments     8/6/09 Direct Wine Sales to Consumers - New Registration and Tax Collection Requirements
      05/10/2006 Direct Wine Sales to Consumers - New Registration and Tax Collection Requirements
Food & Food Ingredients     05/29/2007 "Prepared Food" Tax Changes
         
       
DIRECTIVE: None      
         
       
RPM: None      
         
       
WTD: 14 WTD 29 93-259   SALE AT RETAIL -- LEASE -- INTERVENING USE.A person who purchases or leases an article of tangible personal property for resale or lease in the regular course of business without intervening use need not pay sales or use tax.
  14 WTD 29 93-259   LEASE, RENTAL, OR BAILMENT -- DOMINION AND CONTROL -- CATERERS.In order to find a true lease, rental, or bailment, there must be a change in actual or potential dominion and control over the property.When a caterer supplies linens, tableware, and glassware to its customers as part of its services, there is no change in actual or potential dominion and control over such items.
  14 WTD 29 93-259   INTERVENING USE -- DEFERRED SALES OR USE TAX -- CATERERS.When a caterer supplies linens, tableware, and glassware as part of its services, it is using such items in its business and deferred sales or use tax is due. Invoices showing a "rental" of such items only demonstrate a method of calculating the cost of catering a unique event and not a true lease, rental, or bailment of such items.
  14 WTD 29 93-259   PURCHASED FOR RESALE -- DISPOSABLE PRODUCTS -- FLOWERS -- ICE SCULPTURES -- CATERERS.Disposable items, the first use of which renders such articles unfit for further use, purchased by a caterer solely for use by its customers, are considered as having been purchased for resale.Such items include flower arrangements, ice sculptures, and the like ordered by the caterer's customers.
  15 WTD 123 95-038E   TIPS -- GRATUITIES -- CATERER.A caterer who agrees with a customer on gratuity amount prior to performing service, and then invoices the customer for that amount must include the amount received in its tax measure.
  15 WTD 123 95-038E   SALE AT RETAIL -- LEASE -- INTERVENING USE.A person who purchases or leases an article of tangible personal property for resale or lease in the regular course of business and also puts it to intervening use, must pay sales or use tax.
  15 WTD 123 95-038E   LEASE, RENTAL, OR BAILMENT -- DOMINION AND CONTROL -- CATERERS.In order to find a true lease, rental, or bailment, there must be a change in dominion and control over the property.When a caterer supplies plates, glasses, silverware, cooking equipment, linens and tents to his customers as part of his services, there is no change in actual or potential dominion and control over such items.
  15 WTD 123 95-038E   INTERVENING USE-- DEFERRED SALES OR USE TAX -- CATERERS.When a caterer supplies plates, silverware, glasses, cooking equipment, linens and tents as part of his services, he is using such items in his business and deferred sales or use tax is due.Invoices showing a "rental" of such items only demonstrate a method of calculating the cost of catering a unique event and not a true lease, rental, or bailment of such items.
  19 WTD 398 99-109   MEALS PROVIDED TO EMPLOYEES VS. MEALS PROVIDED TO MANAGERS.Taxpayers failed to distinguish meals consumed by managers from those consumed by employees.Taxpayers failed to prove that there was no "exchange of services" involved with the managers' meals.
  20 WTD 47 00-092   RETAIL SALES TAX - EMPLOYEE MEALS. Meals furnished as fringe benefits are part of compensation to employees for services rendered and are taxable as retail sales and subject to sales tax.
  20 WTD 47 00-092   RETAIL SALES TAX - EMPLOYEE MEALS - FOOD COST.Where no specific charge is made, the measure of the tax will be the average cost per meal served to each employee, based upon the actual cost of the food, and does not include labor.
  20 WTD 47 00-092   RETAIL SALES TAX -- OVER-COLLECTED.Over-collected retail sales tax may not be retained by the seller for its own use, but is held in trust and must be remitted to the state if not returned to the purchasers.Kitsap-Mason Dairymen's Association v. Tax Commission, 77 Wn.2d 812, 467 P.2d 312 (1970).
         
       
OTHER: