Frequently Asked Questions

The Ohio Department of Taxation has compiled a list of frequently asked questions covering many different categories.

To view the questions, click on the "Select Category" bar and then click on the category you are interested in. A list of questions will appear pertaining to that category. Then click on the question you are inquiring about and the answer will appear.

Can the RAGRET be collected from customers?

Beginning on September 29, 2015, a person may separately or proportionately bill or invoice the RAGRET to recover the cost of the RAGRET. However, the tax incidence remains on the person with the business activity within the resort area or tourism development district. In the alternative, businesses may incorporate the cost of the tax in the price charged to the customers, as the tax is an expense to the business person similar to other operating expenses and the cost of goods sold. Accordingly, if the RAGRET is stated on invoices, sales receipts, or any other document given to customers as the result of a sale, it remains part of the price and is subject to the sales tax.

The RAGRET should never be lumped into the line dedicated for state and local sales tax. The RAGRET should be identified as a resort tax and separately stated on the customer's receipt or invoice. Any and all amounts listed on customers’ receipts or invoices as sales tax must be included in the retailer's sales tax liabilities reported and remitted to the Department.

The following scenarios are not acceptable. In each example, the sales tax rate in Ottawa County is presumed to be 7%.

Example 1: Combining the RAGRET into the Sales Tax Line on the Receipt in Ottawa County.

Item #1          $100.00
Tax of 8.5%       $8.50
Total              $108.50

R.C. 5739.29 requires vendors to collect the full and exact sales tax rate. Since this receipt indicates the tax of 8.5% was collected from the customer, the entire 8.5% must be reported and remitted to the Department as sales tax. If the vendor only reported and remitted 7% as sales tax, the Department would consider the difference between 7% and 8.5% to be sales tax collected by the vendor and not remitted. Therefore, the vendor would be subject to a penalty of 50% of the unremitted tax. In this scenario, the customer was overcharged sales tax by the vendor. Upon presenting their receipt, the customer is entitled to a refund of the 1.5%.

Example 2: Combining the RAGRET into the Sales Tax Line on the Receipt but Including a Disclaimer in Ottawa County.

#1                  $100.00
Tax of 8.5%       $8.50
Total              $108.50

The tax rate of 8.5% includes a 1.5% resort tax charge.

This scenario is similar to Example 1, except this receipt specifically states that part of the tax is attributed to the RAGRET. Even a statement that 1.5% of the sales tax is the RAGRET results in an inaccurate collection of sales tax. Because the amount is identified as tax, the full amount of the 8.5% needs to be remitted to the Department. Under audit, the Department would consider the 1.5% to be sales tax collected and not remitted by the vendor, subject to the 50% penalty.

Permissible Method

For vendors that want to separately state the charge on customers’ receipts, one scenario that conforms to the requirements of the sales tax law is to add a separate line on the receipt to show the amount of the resort tax, which is included in the price. Note that when the RAGRET is itemized on the invoice, it is also subject to the sales tax. Here’s an example of how that receipt would appear:

Item #1                            $100.00
Resort Tax of 1.5%                $1.50
Subtotal                           $101.50
Tax of 7%                            $7.11
Total                                $108.61

By separately stating the RAGRET on the receipt to the consumer and adding the RAGRET to the total purchase price of the item, this method would not violate the provisions of the Revised Code. Separating the sales tax from the RAGRET also ensures proper record keeping for sales tax purposes.

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