HAVE DONE BOOKKEEPING/ACCOUNTING SINCE 1957.
SALES TAX APPLIES WHEN YOU SELL SOMETHING
NOT WHEN YOU GIVE SOMETHING AWAY
Tell that to the Oprah audience members who received a free car from her.
While GM covered the sales tax on the Pontiac G6 autos, the cars were considered to be promotional giveaways and are taxed as income, just like the prizes you receive on a game show.
Similarly, these hot dogs are promotional giveaways, not gifts and are taxable. If the stadium or team owner didn't cover the sales tax, then the recipients are on the hook.
See: That Time Oprah Gave 276 People Free Cars That Actually Cost Them $6,000 In Taxes