Is or Isn’t Peanut Butter a Grocery Staple in Maine? Wacky Tax Wednesday
- Sales and Use Tax
- July 8, 2015 | Gail Cole
Politics has become acrimonious in Maine, where Governor Paul LePage may face impeachment. The Battle of the Biennial Budget was ultimately won by overriding LePage’s veto. Though I can’t imagine the bitter atmosphere is pleasant for Mainers, what’s been happening Down East has been fun to watch from my safe vantage in the Pacific Northwest. To see an example of what I mean, check out the governor’s veto message, which reads a little bit like a sensationalizing magazine from a grocery store check out line. It is only lacking a few fat celebrities in bikinis.
A propos of grocery stores, the new budget amends the definition of grocery staples, which are exempt from Maine sales tax. This has caused some confusion with respect to peanut butter—a staple in many American households.
Under the new budget (LD 1019), amended section 3-B. Grocery staples does not include the following:
- Spirituous, malt or vinous liquors;
- Medicines, tonics, vitamins and preparations in liquid, powdered, granular, tablet capsule, lozenge or pill form, sold as dietary supplements or adjuncts, except when sold on the prescription of a physician;
- Water, including mineral bottled and carbonated waters and ice;
- Dietary substitutes;
- Candy and confections, including but not limited to confectionery spreads. As used in this paragraph, “candy” means a preparation of sugar, honey or other natural or artificial sweeteners in combination with chocolate, fruits, nuts or other ingredients or flavorings in the form of bars, drops or pieces;
- Prepared food; and
- The following food and drinks ordinarily sold for consumption without further preparation:
- Soft drinks and powdered and liquid drink mixes except powdered milk, infant formula, coffee and tea;
- Sandwiches and salads;
- Supplemental meal items such as corn chips, potato chips, crisped vegetable or fruit chips, potato sticks, pork rinds, pretzels, crackers, popped popcorn, cheese sticks, cheese puffs and dips;
- Fruit bars, granola bars, trail mix, breakfast bars, rice cakes, popcorn cakes, bread sticks and dried sugared fruit;
- Nuts and seeds that have been processed or treated by salting, spicing, smoking, roasting or other means;
- Desserts and bakery items, including but not limited to doughnuts, cookies, muffins, dessert breads, pastries, croissants, cakes, pies, ice cream cones, ice cream, ice milk, frozen confections, frozen yogurt, sherbet, ready-to-eat pudding, gelatins and dessert sauces; and
- Meat sticks, meat jerky and meat bars.
As used in this paragraph, “without further preparation” does not include combining an item with a liquid or toasting, microwaving or otherwise heating or thawing a product for palatability rather than for the purpose of cooking the product.”
“Grocery staples” includes bread and bread products, jam, jelly, pickles, honey, condiments, maple syrup, spaghetti sauce or salad dressing when packaged as a separate item for retail sale.
Reading this, which is quoted in full for full effect, I am reminded of Michael Pollan’s Great Grandmother Rule: “Don’t eat anything your great grandmother wouldn’t recognize as food” (In Defense of Food). The more our grocery store shelves are laden with new products, the more this section will have to be amended. But I digress.
The nut question
Taxable grocery staples now include “Nuts and seeds that have been processed or treated by salting, spicing, smoking, roasting or other means.” For good reason, this has caused many Down East to wonder whether or not this means peanut butter.
The peanut butter in my refrigerator contains organic roasted peanuts and 1% or less of salt. I know the nuts have been processed because I can spread them on my toast. Were it up to me to decide, I would assume this means that my jar of peanut butter is taxable in Maine.
Fortunately for Maine lovers of PB&J, I’d be wrong.
Maine Revenue Services set me right in this Maine Tax Alert:
“Please be advised that the Budget Bill exclusion of ‘nuts and seeds’
[in LD 1019] does not change the exemption for peanut butter as a qualifying ‘grocery staple.’ This new exclusion would, however, apply to nuts and seeds that remain as nuts and seeds such as peanuts (whether plain, salted, dry-roasted, spiced, smoked, or flavored), almonds, cashews, sunflower seeds, pistachios, walnuts, and pecans.”
So there it is.
What do I love most about sales tax? That it allows me to research and write about peanut butter in Maine. Wacky.