​Application of sales and use tax to the rental of space for meetings, conventions, short-term business uses, entertainment events, weddings, banquets, parties, and other short-term social events, pursuant to KRS 139.200(2)(a) (effective 01/01/2023).​​

​No, the scope of this newly taxable service does not include charges exclusively for the rental of real property for the purpose of storage. However, please note that the rental of mobile pod units is already subject to sales and use tax as the rental of tangible personal property. See Kentucky Regulation 103 KAR 28:051.​

​Separate charges for conference rooms, ballrooms, or any rental of space by these accommodation providers becomes subject to sales and use tax as of 01/01/2023​.

In transactions where the lessee by contract subleases, subrents, or otherwise sells the space to exhibitors or others that use the space in association with the event conducted under the primary lease, receipts from the subsequent lease, rental, or sale of the space are not subject to sales and use tax provided the tax is paid on the initial rental of the space by the primary lessee to the lessor. This treatment is effective for transactions on or after 01/01/2023.​

​​Yes, non-profit organizations receiving payments for the rental of space are liable for sales and use tax on those receipts. Although the sale of admissions for non-profit educational, charitable, or religious 501(c)(3) organizations is exempt under KRS 139.495 and the sale of admissions by non-profit civic, governmental, or other non-profit organizations is exempt under KRS 139.498, there is no corresponding exemption in HB 8 to exempt these non-profits from liability for sales tax on their receipts from these space rentals.​​​

​Longstanding exemptions for 501(c)(3) educational, charitable and religious organizations under KRS 139.495 still apply to the purchase of otherwise taxable services used in the exempt function of the organization.

The exemption under KRS 139.470(6) for state and local governments will still apply to exempt their purchases of rental space for use within their governmental functions.​

​The rental of space for “short-term business uses" and “short-term social events" means an agreement to rent space for business uses or social events where the term of the rental is less than 30 days. For example, an agreement to rent space to operate a booth at a lawn and garden show for a weekend is a taxable rental of space for a short-term business use.  However, charges for a six-month lease of an office space are not subject to sales and use tax.  ​​​

  • Rental of a clubhouse
  • Rental of a park shelter
  • Rental of an athletic field
  • Rental of a swimming pool for a group outing
  • Rental of space for a pop-up retail sales event
  • Rental of banquet space at a restaurant

  • Charges for IT support and additional phone lines
  • Charges for trash pickup at or after an event
  • Charges for set up or take down of seating arrangements
  • Charges for hanging signage
  • Charges for provision of ticket agents