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Missouri House Passes Bill Exempting Health Clubs from Sales Taxes

Under current Missouri state law, fees paid to athletic, exercise and fitness clubs are subject to sales tax.

The Missouri House of Representatives overwhelmingly passed a bill Thursday that would shield health clubs from sales taxes.

House members passed the bill 123-26, the Associated Press reported, and the bill now goes to the state Senate, which approved its own version of the bill last week.

Missouri state law establishes a sales tax on admission and fees "paid to, or in any place of amusement, entertainment or recreation, games and athletic events," according to the report. The Missouri Supreme Court ruled in 2001 that athletic, exercise and fitness clubs count as places of recreation and that fees paid to them are subject to sales tax.

In 2008, the Missouri Supreme Court ruled that sales tax must be paid for fees that a fitness facility said it received for personal training services.

Missouri House Bill 1179 calls for applying a sales tax when people are charged to watch an activity but not when they pay to participate.

"Children or adults who want to be in gymnastics or any individual who wants to join a gym, we should not be discouraging those people from doing healthy activities," sponsoring Rep. Eric Burlison told the Associated Press.

The Missouri Department of Revenue has come under fire in recent weeks for auditing businesses throughout the state. Nonprofit arts groups in Kansas City, MO, received letters from the department in early March informing them they had to pay sales taxes, The Kansas City Star reported.

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