The Tennessee Department of Revenue issued a letter ruling March 9 determining that fees to access online live and on-demand fitness classes are taxable since the fees include specified digital products. The taxpayer sells home exercise equipment that can connect to the Internet. The taxpayer offers live, instructor-led classes and prerecorded, on-demand fitness classes for later viewing. The taxpayer sells online memberships with nonitemized fees for both types of classes. The taxpayer provides performance feedback during live classes from customers’ connected Internet devices which can be used for comparison in live and on-demand classes.
Source PwC
