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Idaho: Should Girl Scout Cookies Be Tax Exempt?

  • Feb 27, 2013 | Gail Cole

 Would You Still Buy These If You Had to Pay Sales Tax?

UPDATE 4.8.13: Although the Idaho House passed HB 250, which would provide a sales tax exemption for sales of Girl Scout cookies, the bill died in the Senate.

Undaunted, the Idaho Girl Scouts are determined to try again next year. They argue that their organization "save[s] the state money by building responsible girls who are more likely to earn college degrees and less likely to go to prison." 

Certainly their attempt to win an exemption for cookies has taught the scouts valuable skills. As Ella Marcum, 9, wisely observed, "You need to have patience and perseverance."

Girl Scouts of America, founded by Juliette Gordon Low in 1912, is a non-profit organization known and beloved by many for what it offers girls: "Girl Scouting builds girls of courage, confidence, and character, who make the world a better place." It also makes a mean cookie.

March brings crocus, daffodils, and Girl Scout Cookies. Right now, Girl Scouts across the country are trying to make their sales quotas and customers are deciding how many boxes of Do-Si-Dos and Thin Mints to order. But in Idaho, the cookies are getting political.

Idaho Girl Scouts don't want to collect and remit sales tax on their cookies. Lobbyist Julie Hart is pleading their case to the state Legislature, arguing that "[t]he State of Idaho should not balance the budget on the backs of Brownies." Ouch. Cookies should be exempt from sales tax, she says, because "money raised goes toward building life skills." (State Impact / NPR).

Of course, it could be argued that learning about taxes is also a life skill.

This is not the first time the Girl Scouts have disputed with a state over sales tax and cookies. More than two decades ago, Maine made headlines all around the country when it "changed its interpretation of the 6% [snack] tax and extended it to Girl and Boy Scouts."  Girl Scout cookies were taxed at the wholesale level for three years in Maine, from 1991 to 1994, before the Girl Scouts took the state to court and won an exemption (and a nice refund). Then in 1995, the state tried to make the organization collect and remit sales tax on retail sales of the cookies. Again they went to court, and again the Girl Scouts won. (Bangor Daily News).

Back in 2011, Georgia HB 387 proposed eliminating the sales tax exemption for Girl Scout Cookies. People from Savannah to Atlanta were outraged, and the exemption held.

Many states, such as Mississippi and South Carolina, Tennessee and Virginia, exempt the national non-profit from collecting and remitting sales tax on the cookies. Girl Scout Cookies are typically exempt from sales tax because they are described as seasonal fundraising or casual sales.

Washington and Hawaii do not allow an exemption for cookie sales. The Encyclopedia of Taxation And Tax Policy notes that for states "[t]o provide no sales exemption at all [for non-profits] is the exception."

Sales tax on a box of cookies in Idaho is 22 cents. Annual cookie sales total roughly $2.5 million, which translates to approximately $140,000 in tax revenue each year. That's money the state is loathe to renounce.

On the other hand, the Idaho House recently approved a sales tax exemption for pregnancy centers.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.