Insights

Ohio State Sales Tax on Certain Food and Drinks

Do you trust the retailer is complying with sales tax on your receipt?

According to Ohio state law, food is not subject to tax and is considered food “if a substance, whether in liquid, concentrated, solid, frozen, dried, dehydrated forms is consumed by humans for nutritional value or taste."

However, there are still many variations, according to an article.

  • Gum - considered food and is not subject to sales tax.
  • Coffee with artificial sweeteners - not considered food and is subject to sales tax.
    • If you take your coffee black or with a milk product, it’s considered food and not taxable. If you buy a coffee drink but don’t take any milk in it and get caramel syrup added, it’s not considered food and will be taxed.
  • Ice - considered food and is not subject to sales tax. However, ice that is sold for cooling purposes is not food and is taxable. But according to the state, “for administrative purposes, ice sold by grocery, convenience, and similar stores is presumed to be food and no tax should be charged.”
  • Gatorade and energy drinks - not considered food and is subject to sales tax if it is sold in the bottle and ready to drink. However, the article states, "if you buy it in powdered form to mix into water, its considered food and not taxed (same with Kool-Aid). To make it even more confusing, if it’s a sweetened liquid drink concentrate, it’s nonfood and taxed."

To add to the confusion, the article also states, "If a store offers a sale price, the sales tax collected is reduced by the savings. But the key is whether the reduced price is made up solely of a reduction by the retailer or if a third-party, such as a manufacturer or vendor, will to reimburse the store for that savings. If a third-party is paying back the retailer, the consumer has to pay sales tax on the price before the reimbursement."

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