Fresh Juice May Be Tax-Free in New York
- Sales Tax News
- Aug 10, 2015 | Gail Cole
Few things satisfy on a hot summer day in New York like a cold, fresh, juice drink. The drink is even more pleasurable when it is tax-free.
According to an advisory opinion recently released by the New York State Department of Taxation and Finance, a petitioner’s sales of blended, unpasteurized “cold nutritional and cleansing juice drinks… made with organic fresh fruits and vegetables, without any additional supplements” are not subject to New York sales tax.
The drinks consist only of fruits, vegetables and water, and are therefore considered by the department to fall under the exemption for “Food and food products” sold for human consumption (Tax Law §1115(a)(1)).
The department also concluded that the insulating bag provided with these beverages does not change the taxability of the product. The advisory opinion reads as follows:
“Although the bag comes with the product, it is provided to the customer without charge. The bag is not required to be returned and no “bag deposit” is imposed. The bag is flimsy, and tears easily. While the bag is tangible personal property, because it appears to be merely incidental to the sale of the juice, it is not considered to be the sale of tangible personal property for purposes of sales tax… Accordingly, the sale of the juice in the insulating bag for a single charge is not subject to tax.
Please note that an advisory opinion is “binding only with respect to the person or entity to whom it is issued and only if that person or entity fully and accurately describes all relevant facts.” That said, advisory opinions reveal how departments of revenue interpret tax law and are therefore instructional.
Automated sales tax Software-as-a-Service (SaaS) helps businesses keep track of changing rates, rules, and product taxability, simplifying sales tax compliance in all states. Learn more.