OLYMPIA, WA -- Yoga studios in the state of Washington will not have to charge customers a sales tax, according to the state’s Department of Revenue.
The owner of a yoga studio in Federal Way, WA, was audited earlier this year and was told that she owed about $20,000 worth of back taxes over the past three years, according to a Seattle Times report. Suzy Green-Cindrich, owner of Three Trees Yoga, as well as other yoga instructors in the Seattle area protested the audit.
A provision in the state law says that physical fitness services are subject to a sales tax, thus creating confusion. However, state Department of Revenue rules said that yoga studios that are primarily instructional do not have to charge a tax, but they do if the studios are run for exercise purposes, according to the report.
The backlash from the yoga studios caused the agency to reverse its course.
“We kind of left it up to the provider to determine what they’re doing. Some of them said, ‘We’re instructional,’ and some of them said, ‘We’re just exercise,’” Mike Gowrylow, a spokesman for the agency, told the newspaper. “We decided the yoga people had made a very good case that yoga, and similar kinds of things, are not really what most people think of as physical fitness.”
Yoga studios that had been collecting a sales tax will discontinue that on Dec. 1, and none of the studios will be asked to pay back taxes. The department, however, plans to define what the state considers to be a yoga studio, according to the newspaper. This is an attempt to prevent fitness clubs from having to avoid charging a sales tax simply by labeling an exercise routine as yoga, Gowrylow told the newspaper.