Are sales taxes collected from guests included in the Gross Revenue calculation for a Camp Margaritaville?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
Gross Revenue shall exclude only: (a) free or discounted rooms and upgrades or other "comps" for which the Resort collects no revenue or in-kind value for; (b) federal, state, or municipal excise, room, sales, or use taxes, or similar taxes collected from guests and paid to an applicable governmental authority; (c) gratuities, service charges, or similar receipts collected and then paid directly to staff; (d) any sale of fixtures, machinery, or other equipment that is not in the ordinary course of your business; (e) any gift card, coupons, or the like at the time of purchase, but which shall be included in Gross Revenue upon redemption; (f) any complimentary breakfast service; and (g) any other adjustments to revenue in conformance with accounting principles generally accepted in the United States ("GAAP") and the Uniform System of Accounts for the Lodging Industry, 11th Edition (Educational Institute of the American Hotel and Motel Association, publisher), or a later edition we approve ("Uniform System") (excluding any adjustment that excludes resort fees and the like).
We and you will account for Gross Revenue according to the Uniform System.
Source: Item 6 — OTHER FEES (FDD pages 20–34)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, gross revenue excludes federal, state, or municipal excise, room, sales, or use taxes, or similar taxes collected from guests and paid to an applicable governmental authority. This means that when calculating the revenue on which Camp Margaritaville franchisees pay royalties and other fees, they do not need to include these collected taxes in the gross revenue figure.
This exclusion of sales taxes from gross revenue is a benefit for Camp Margaritaville franchisees. By excluding these taxes, the base amount used to calculate royalty fees is lower, resulting in lower royalty payments to the franchisor. This can improve the franchisee's profitability.
Camp Margaritaville franchisees should ensure they properly account for and deduct these taxes when reporting their gross revenue to the franchisor to avoid overpaying on royalties and other fees. Accurate accounting practices are essential to maximizing profitability and maintaining compliance with the franchise agreement.