A restaurant operator’s (taxpayer) payment of charges for the use of a third-party vendor’s table top ordering and bill payment tablets were subject to South Carolina sales and use tax. The taxpayer uses the tablets in its restaurants to facilitate order placement, order add-ons, checkout/payment, and customer satisfaction surveys. The tablets also allow the restaurant’s customers to play games for a fee. The third-party vendor charges the taxpayer monthly service fees for the use of the tablets. The taxpayer keeps 100% of the game fees it collects each month, up to the amount of the monthly service fees. Any additional game fees collected by the taxpayer are split between the taxpayer and the vendor 80%/20%, respectively. In South Carolina, retail sales of tangible personal property include the rental of tangible personal property and are subject to sales and use tax. The monthly services fees paid by the taxpayer – which includes the portion of the game fees paid to the vendor – constitute a rental fee and are therefore taxable. The taxpayer is the user or consumer of the tablets. Therefore, the rental of the tablets is a retail sale. The taxpayer’s charges to customers to play games on the tablet are not a charge for the sale, lease, or rental of tangible personal property and nor are they a charge for communication services. As a result, the charges to the restaurant’s customers to play games on the tablets are not subject to tax. (Private Letter Ruling #18-2, South Carolina Department of Revenue, October 19, 2018)