Terms And Conditions
SALES TAX for Daily Deals
June 2011 TAX POLICY NEWS
A monthly newsletter about Texas tax policy
Daily deals offered by sellers through third parties, such as social media networks and radio stations, are treated as gift certificates. Sales tax is not due on the sale of a deal by a third party.
When the deal is redeemed for a taxable item (either by the original purchaser or someone who may have received the deal as a gift), the deal is treated like cash given for the purchase of the item. If the item purchased is taxable, sales tax is due on the full sales price, including any amount paid with the use of the deal.
For example, a customer purchases a daily deal through an online site that offers $50 worth of food for $25 at a local restaurant. Tax is not due on the customer's purchase of the deal from the online site. When the customer redeems the deal at the restaurant, tax is due on the menu price of the meals and drinks. The value of the daily deal is then applied against that amount.