Legal Question in Tax Law in California

gratuity tax

Is is legal to be taxed on the gratuity for a wedding reception? I understand that I should be taxed on food and beverage, but should my 20% gratuity also be taxed?


Asked on 7/17/04, 3:56 pm

1 Answer from Attorneys
Ken Koenen Koenen & Tokunaga, P.C.

Re: gratuity tax

Sorry, the state needs the money that they already spent.

If there is a mandatory "gratuity" that is will be added by a catering contract or other contract, the restaurant is required by the State Board of Equalization to tax that amount.

Only voluntary tips are exempt from sales tax.

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Answered on 7/17/04, 4:46 pm


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