State enforcing sales tax on yoga

ST. LOUIS -- On Sunday, Missouri became the only state to enforce a sales tax on what many see as a spiritual pursuit -- the practice of yoga.

The debate between Missouri's yoga community and the state centers on whether yoga is a spiritual practice or just exercise. If it's one, it's constitutionally protected and can't be taxed. If it's the other, Missouri's cash-strapped budget has a new source of revenue.

On Monday, yoga studio owners pledged to fight for their students and educate state legislators about yoga's spiritual roots.

Last year, a similar First Amendment battle broke out in Washington when that state began including yoga studios in a group of recreational organizations that had to charge customers a sales tax. Yoga practitioners, teachers and studio owners in Seattle and around the state came together to show legislators and the Department of Revenue that yoga was different from other physical activities.

"They told us that yoga is more than just staying physically fit; it's more of a spiritual and mental type of exercise," said Mike Gowrylow of the Washington Department of Revenue. "After they educated us, we agreed they had a point."

The state decided to leave yoga studios alone.

The Missouri yoga community and the state's Department of Revenue are now at similar cross-purposes. Like many states, Missouri leaders are looking to alternative sources of revenue as budgets continue to tighten. If the state prevails, it will be the only one in the country to levy sales taxes on the spiritual services provided by yoga studios.

"The Missouri Supreme Court has held that athletic and fitness clubs are places of recreation and therefore fees paid to these types of businesses are subject to sales tax," David Zanone, manager of the Missouri Department of Revenue's taxation division, wrote to 140 yoga and Pilates studio owners in a letter dated Oct. 13. "Yoga centers offer the same types of fitness services that the Missouri Supreme Court has held are taxable."

At issue is a Missouri statute that mandates a 4 percent tax on fees charged for athletic events like Cardinals games, fitness club memberships and other entertainment, amusement or recreation businesses.

Yoga teachers say the service they provide is not recreation but a form of physical preparation for meditation, based on ancient Hindu texts, with the ultimate goal of spiritual enlightenment.

But even yogis concede the American interpretation of yoga that has blossomed, especially in the last 30 years or so, has become popular for its stress-reducing properties and health benefits.

Practitioners can be found both in traditional gyms, among free weights and elliptical machines, and in self-contained studios whose owners are more inclined to teach yoga's spiritual foundations.

That tension -- yoga as meditation versus yoga as exercise -- is at the heart of the argument that yoga teachers plan to make to legislators in Jefferson City in coming weeks.

For years, the state has simply not required yoga studios to charge a sales tax.

In a statement, the Missouri Department of Revenue said the sales tax for yoga studios "has long been on the books" and "was recently clarified" by a 2008 Missouri Supreme Court case. The department, it said, is not seeking retroactive payments and "will consider religious exemption issues on a case-by-case basis."

For now, yoga studio owners said they would comply with the request to collect sales tax, even as they prepare to fight it. For a typical 90-minute session, a teacher might charge a student $15.60, instead of $15; the yoga studio would subtract 60 cents and send it to the state.

"Our studio will pay the sales tax under protest, so when we lobby the legislature, we'll have a stronger voice," said Brigette Niedringhaus, owner of Southtown Yoga in St. Louis.