Rev. Rul. 54-617

Advice is requested concerning the application of the special tax imposed by section 3268 of the Internal Revenue Code of 1939 to the operation of bowling alleys, and billiard and pool tables by a community center where no charge is made for the use thereof.

Section 3268(a) of the Code provides that every person who operates a bowling alley, billiard room, or pool room shall pay a special tax of $20,00 per year for each bowling alley, billiard table, or pool table. Every building or place where bowls are thrown or where games of billiards or pool are played, except in private homes, shall be regarded as a bowling alley, billiard room, or pool room, respectively. No tax is imposed with respect to a billiard table or pool table in a hospital if no charge is made for the use of such table. Further, no tax is imposed with respect to any bowling alley, billiard table, or pool table maintained exclusively for the use of members of the Armed Forces on any property owned, reserved, or used by, or otherwise acquired for the use of, the United States if no charge is made for their use.

The exemptions mentioned above are the only exemptions which the law provides.

Community centers, civic, religious, or educational institutions, rooms in fraternal or charitable organizations, dormitories, or clubrooms are not considered to be `private homes' within the meaning of section 3268(a) of the Code. Whether a profit is realized from the operation of bowling alleys, and billiard and pool tables in such locations is immaterial in determining the liability for special tax. Accordingly, a community center which operates bowling alleys, and billiard and pool tables as part of its youth program is subject to the special tax imposed by section 3268 of the Code even though no charge is made for their use.