by TaxJar January 19, 2024
Please note: This blog was originally published in 2020. It’s since been updated for accuracy and comprehensiveness.
Every state is a little different when it comes to sales tax. This guide will walk you through when – and when not to – charge sales tax when selling food and beverages in New York.
Are groceries taxable in New York?
In New York, grocery items are generally exempt from sales tax if they meet the following criteria:
- Sold for human consumption
- Sold unheated
- Sold in the same form and condition, quantities, and packaging as is commonly used by retail food stores
This is with the exception, however, of candy and confectionery, as well as some beverages. Those are taxable. (See “Are beverages taxable in New York?” below.) Interestingly, ice cubes are also taxable in New York. However, baked snacks like donuts are tax exempt.
New York handily provides a listing of taxable and tax exempt food and beverages in Tax Bulletin ST-525.
Are meals taxable in New York?
Prepared food is generally subject to sales tax in New York. This includes restaurant meals, but also meals sold by a deli or bakery. Sandwiches and prepared platters (like cold cut platters or vegetable trays) are generally taxable whether sold hot or cold. Also, New York specifies that all food that is sold heated is considered prepared and is taxable.
Are beverages taxable in New York?
Beverages like coffee and tea are generally non-taxable in New York. But sodas, fruit juices and even bottled water are generally taxable.
New York handily provides a long list of taxable and tax exempt beverages in Tax Bulletin ST-525.
How to always collect the correct amount of sales Tax in New York
Do you sell groceries, meals or beverages? Are you required to collect sales tax in New York? Then this may sound like a huge headache.
That’s where TaxJar can help.
With the TaxJar API, you can be sure you’re collecting the right amount of sales tax on every transaction. Our product tax codes ensure you do collect sales tax on that soft drink but don’t collect sales tax on that plain coffee drink.
Not to mention, most e-commerce businesses have nexus in multiple states. For example, groceries are taxable in some states, but non-taxable in others. Or, like Illinois, they are taxable at a reduced rate. With TaxJar, you’ll collect the right amount of sales tax from every customer, in every state, every time.
Further food and meal taxability resources:
- Sales Tax by State: Are grocery items taxable?
- Sales Tax by State: To-Go Restaurant Orders
- Is the food I sell on my food truck taxable?
- New York Sales Tax Guide for Businesses
Ready to automate sales tax collection, reporting and filing? Click here for more on how TaxJar can take the headache out of sales tax in your food & beverage business.
