Seattle ‘Dance Tax’ Debate

Seattle bar and club owners are reportedly up in arms about a “dance tax” levied by the state that they say could put some of them out of business.

Seattle’s The Stranger reported Aug. 16 that state Department of Revenue auditors informed three club owners they owe thousands of back taxes for giving patrons “an opportunity to dance.”

The issue stems from a state law that levies a 9.5 percent sales tax on amusement, recreation and physical fitness activities such as golf, billiards, swimming and “charges made for providing an opportunity to dance,” according to The Stranger. The law was reportedly amended in 1993 to include the Jazzercise and aerobics industries.

So if a venue hosts an event where patrons can dance if they want to, the tax needs to be added to the ticket price or cover charge.

Concerts, on the other hand, are exempt because they are classified as “entertainment.” Fans busting a move in the aisles is secondary to watching the performance, the Stranger said.

One club owner, who asked to remain anonymous, claimed that paying the large tax bill could put him out of business.

Others allegedly accuse the state of trying to make up its budget deficit literally at the expense of bar and club owners with the flurry of audits.

Not so, according to Department of Revenue spokesman Mike Gowrylow. The sales tax is nothing new or unexpected.

He added that of 13 venues audited in the last couple of years, eight of them were paying the tax.