There are as many ways to relax during spring break as there are destinations. Most destinations have special taxes aimed at the activities that tourists are most likely to engage in. Whether it’s games of chance, a cold beer, or some recreational marijuana tourists should be prepared to face sin taxes in addition to whatever other consequences result from their spring fling.
First up is New Jersey. While it might be too cold to enjoy the Garden State’s beautiful beaches, there’s always gambling! Visitors have the option of staying in their room and gambling on their laptops or heading down to the casino and putting it all on black. Either way, be prepared to pay tax for winning a prize over $10,000. The actual prize amount is the determinative factor rather than the total amount of cumulative winnings, so that’s $1,000 or less on the hard six. Also, if Lady Luck is really in your favor, certain gambling winnings are subject to a 3 percent withholding.
If you’re looking for more a West Coast vibe, but you still want to try your hand at the craps tables or see a great show then there is no place like Vegas. Be prepared not to let the live entertainment tax spoil your fun—Nevada imposes an additional tax of 5 to 10 percent on admission, food, refreshments and merchandise. On the plus side, Nevada has no state income tax so go bid and max out those bets.
If gambling doesn’t tickle your fancy, and you are looking for a hard drink, head to Wyoming or New Hampshire, where there is no excise tax on liquor. Steer clear of Washington with the highest liquor tax in the country at $35.22 per gallon.
For those who enjoy a cold one on spring break, Wyoming again tops the list with the lowest beer tax of $0.02 per gallon. It might be worth staying “dry” in Tennessee though, which has the highest beer tax of $1.17 per gallon.
The spring break wine aficionados may want to head toward the bayou— Louisiana taxes wine at the low rate of $0.11 per gallon. But Kentucky wine drinkers may be disappointed to learn that they will pay the highest-in-the-nation wine excise tax of $1.17 per gallon.
Those who don’t gamble or “imbibe” may look to alternative recreational activities and may be surprised to know that Colorado allows recreational marijuana with an excise tax of 25 percent on top of other taxes already imposed.
And for those looking for a drag on something legal in all 50 states, a trip to Missouri might be in order. The Show Me State has the lowest per-pack tax on cigarettes, at $0.17. Cigarette tourists might think twice about New York though, where smokers pay $3.45 per pack, plus another $1.50 per pack in New York City.
For those with more exotic tastes, it may be worth noting that the U.S. Supreme Court upheld a Utah law that imposes an additional 10 percent “pole tax” on sexually explicit establishments.
And if all of this seems too involved and spring break merely requires relaxing under some palm trees, expect to pay over 10 percent in combined hotel occupancy and other taxes on either coast in coastal towns from California to Florida.
Continue the conversation on Bloomberg BNA's State Tax group on LinkedIn: Can a sin tax make a destination less desirable to tourists?
Sign up for a free trial of the Bloomberg BNA Premier State Tax Library and see a detailed discussion on state excise, sales, corporate and income taxes.
Follow us on Twitter: @BBNAtax
By Renee Bartoli, David Sohn and Rebecca Helmes
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)