2021 Sales Tax Exemptions Specific To The Food & Beverage Industry
From GBQ
Ohio Restaurant & Hospitality Alliance
Last Update há 2 anos
COVID-19 has frustrated the foodservice industry and, as a result, many bars, restaurants, and food manufacturers are trimming their operating costs and overhead to keep their business running. Sales tax savings are not always top of mind as these businesses consider daily operations, but it is important to note that many states provide significant foodservice-related sales tax exemptions. With a little upfront due diligence and proper planning, sales tax savings can be the main course on a restaurant’s strategic tax menu.
Sales tax is often perceived in absolute terms. The rates are set and it either applies or it does not apply. The surprising reality is that for some industries it is much more nuanced. Restaurants, breweries, and similar businesses operate in this reality. However, within that nuance are potential tax savings applicable to your establishment. Perhaps the most substantial of these potential tax savings is the manufacturing exemption.
As this article will discuss, in many states, such as Ohio and Texas, restaurants and brewers are considered manufacturers, and such states generally provide exemptions on certain processing equipment used to prepare food or beverages for sale. In addition to the manufacturing exemption, there are foodservice-specific exemptions available (i.e. cleaning of food processing equipment and items used to preserve food) and restaurants can benefit from the purchase of a variety of items exempt from tax under the resale exemption.