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Updates to Nevada’s Live Entertainment Tax - Part 2

Exceptions and Exemptions

The new LET includes some new exceptions as well. The tax is no longer imposed on amounts paid for food, refreshments, or merchandise sold at the venue (unless the purchase of such items is required as part of the price of admission, e.g., a 2-drink minimum). The tax is also not imposed on amounts paid for access to tables, seats, lounge chairs, or particular areas near a swimming pool (i.e., the LET applies to the cover charge to enter a day club, but not to any extra amount the patron pays to rent a cabana or a lounge chair once inside). The value of admission provided to a patron on a complimentary basis is also excluded from the tax, unless the complimentary admission is associated with a separate purchase that is required for the patron to have access to the facility.

The new LET also does not include license or rental fees for luxury suites, boxes, or similar products at facilities with a maximum occupancy of at least 7,500 persons. Instead, if the license or rental fee includes the admission of a certain number of patrons to a facility where a live entertainment event is provided, the admission charge is an amount equal to the lowest priced admission charge for the live entertainment event multiplied by the number of admissions to the live entertainment event included in the license or rental fee regardless of the number of admissions actually used. For purposes of this calculation, the “lowest priced” admission must be legitimately available for sale to the public.

For venues with less than 7,500-person occupancy, however, the LET must be paid for such license or rental fees. One taxpayer suggested in the Board’s July 23 public workshop on the new LET regulations that, for these smaller venues, they should continue to use “historical practices” to calculate that admission charge – which they submitted should be the number of luxury boxes divided by the ticket price times the number of live events. This would produce a similar result as seen for venues with greater than 7,500 seats. Hopefully this issue will be clarified in the final regulations.

Other special exemptions:

  • Charitable live entertainment activities where fewer than 7,500 tickets are sold are exempt.

  • Venues with fewer than 200 seats remain exempt from the LET.

  • NASCAR events will be exempt if they give Nevada a second race weekend.

  • Professional sports will be exempt if one of the teams playing in the contest is domiciled in Nevada.

  • Combat sports are exempt from the LET, but are subject to the levies imposed by other sections of the law that have oversight by the Nevada Athletic Commission.

  • Collegiate sports involving Nevada’s schools are exempt, with the exception of the Silver Bowl, which would not be exempted.

© Copyright 2022 Dickinson Wright PLLCNational Law Review, Volume V, Number 232
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About this Author

Jennifer J. Gaynor, Dickinson Wright, Carson City, Gaming Attorney
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Jennifer Gaynor represents clients before the Nevada Legislature in Carson City, Nevada. She also practices before various professional and licensing boards and state and local tax authorities, and represents clients on matters involving First Amendment law, public records and open meeting law, gaming law and regulatory agency actions.

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Gregory R. Gemignani, Dickinson Wright, Intellectual Property Lawyer
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Greg Gemignani's practice focuses primarily on intellectual property law, gaming law, technology law, internet law, online gaming law, and online promotions law. He has represented many clients ranging from the largest casino companies to start-up internet ventures.

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Kate C. Lowenhar-Fisher, Dickinson Wright, Las Vegas, Gaming Lawyer
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Ms. Lowenhar-Fisher is a leading Nevada gaming attorney who counsels many of the world’s premier gaming companies on regulatory issues in connection with mergers and acquisitions, corporate restructuring, reorganizations and financings.  She has extensive experience advising clients on issues related to Internet gaming, social gaming, fantasy sports, liquor licensing, sweepstakes, contests, and promotions. She regularly represents individuals and businesses before regulatory agencies, including the Nevada State Gaming Control Board, the Nevada Gaming Commission, the...

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Jeffrey A. Silver, Dickinson Wright, Gaming regulatory Attorney, Nevada
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Mr. Silver's practice focuses on every aspect of gaming, liquor licensing and regulatory law, as well as planning and zoning matters, contractor licensing and transportation law.

Mr. Silver’s representative clients include Gaming Laboratories International, Dubai World, Mohegan Tribal Gaming Authority, Tuscany Hotel & Casino, Riverside Resort (Laughlin, NV), The Stephen Siegel Group, Grand Sierra Hotel & Casino (Reno, NV), Century Gaming Technologies, Applebee’s Restaurants, Bell Transportation, United Coin, Ryan's Express, and Casino...

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