2 replies to this topic

[HooseFoose]

I am just getting my vending business setup. When I called the State of TX to inquire about sales tax, they said that items sold from vending machines were required to be taxed at the following rates:

Water - 0% of the 8.25% rate
Snacks - 50% of the 8.25% rate
Sodas - 100% of the 8.25% rate

I argued that these were food items and should not be taxed. They said that nontaxable food items were things like groceries, but that "junk food" was taxable. I received a sales tax ID so that I can my inventory sales tax free, but I must include the sales tax in my prices and then send the state a check every quarter or every month.

What is everybody else doing about vending machine sales tax?

Please provide your input.

Sincerely,
HooseFoose

[clvending]

I am just getting my vending business setup. When I called the State of TX to inquire about sales tax, they said that items sold from vending machines were required to be taxed at the following rates:

Water - 0% of the 8.25% rate
Snacks - 50% of the 8.25% rate
Sodas - 100% of the 8.25% rate

I argued that these were food items and should not be taxed. They said that nontaxable food items were things like groceries, but that "junk food" was taxable. I received a sales tax ID so that I can my inventory sales tax free, but I must include the sales tax in my prices and then send the state a check every quarter or every month.

What is everybody else doing about vending machine sales tax?

Please provide your input.

Sincerely,
HooseFoose

Each state has different tax laws regarding vending. In Colorado, some cities I am required to pay sales tax, some I am not. Of course I have to pay state tax. For me tax rates vary by city, it appears for you it is a bit more complicated. I would ask them if they consider healthy snacks "junk food."

Good Luck!!

Lee

[kevin]

I am just getting my vending business setup. When I called the State of TX to inquire about sales tax, they said that items sold from vending machines were required to be taxed at the following rates:

Water - 0% of the 8.25% rate
Snacks - 50% of the 8.25% rate
Sodas - 100% of the 8.25% rate

I argued that these were food items and should not be taxed. They said that nontaxable food items were things like groceries, but that "junk food" was taxable. I received a sales tax ID so that I can my inventory sales tax free, but I must include the sales tax in my prices and then send the state a check every quarter or every month.

What is everybody else doing about vending machine sales tax?

Please provide your input.

Sincerely,
HooseFoose

Im from texas and I believe those are a bit incorrect.

Soda 100%
candy 100%
chips 100%
pastry(fresh) 0%
crackers(under 50 cents 50%

I got that from the state info not local and we have been doing it that way for over 20 years given things have changed a bit over the years. Texas sales tax is a bit high though and the same rules apply in grocery stores because only non prepared food is exempt and snacks are ready to eat.