Food is frequently mentioned in the New York State Sales and Use tax laws. Bagels have now become the newest source of controversy. The Wall Street Journal details New York State's efforts to collect sales tax on sliced and prepared bagels http://online.wsj.com/article/SB10001424052748704340504575448033463314628.html . Essentially if the bagel is not sliced and is eaten off premises...no sales tax. If the bagel is sliced and a topping added (pick your favorite)...subject to sales tax. Why is a sliced or unsliced loaf of bread not subject to sales tax? Maybe the bread bakers have a better lobby than the bagel bakers?
Some additional food topics in the law...
A block of cheese purchased in the store is not subject to sales tax. Place the cheese on a decorative cutting board and wrap in plastic, the sale price of the cheese and cheese board are subject to sales tax.
Is a Twix a candy or a cookie? Cookies purchased in the store are generally not subject to sales tax. However, if the Twix is sold and advertised as a candy, it is subject to sales tax http://www.tax.state.ny.us/pdf/advisory_opinions/sales/a93_38s.pdf.
Confused? You should be.
Have you thought about your business processes and the application of state sales and use taxes? Have you updated your businesses understanding of sales and use tax laws that apply to products or services you sell?
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