Sales Tax on Groceries by State
In brief:
- Most states don’t require a sales tax on groceries.
- Even if a state does require sales tax on groceries, many tax them at a reduced rate.
- Because studies show that the most food-insecure counties in the US are ones with a grocery tax, more states are now considering abolishing their sales tax on groceries.
Grocery items like bread and vegetables are exempt from sales tax in most US states. But before you set every consumable you sell as “non-taxable” let’s dig into the nitty gritty on sales tax on grits (and other groceries.)
| Further reading: • How do you calculate the sales tax rate for Texas? This guide to Texas sales tax has it all, including how to collect and remit it. • Explore all about the sales tax rates in California (by county and city.) |
Why are groceries tax exempt?
Like all taxes, sales tax is political. States often exempt tax on necessities like food, medicine and sometimes even clothing.
In fact, studies have shown that that the most food-insecure US counties are the ones who still levy a sales tax on groceries. A recent US trend has states like Virginia and Kansas either phasing out or abolishing the state sales tax on groceries altogether.
How Grocery Sales Tax Works
Currently 15 US states have some form of sales tax on groceries.
Several of these states have no statewide sales tax on groceries, but allow local areas to still require a sales tax on grocery sales. For example, in Georgia, groceries are not taxable at the state level. But individual counties and other jurisdictions are still allowed to require sales tax on grocery purchases.
Example: When buying a loaf of bread in Cherokee County, Georgia, you would not be required to pay Georgia’s 4% sales tax rate. But you’d still be required to pay the 2% Cherokee County special local option tax.
Some other states tax groceries, but at a reduced rate. Missouri, for example, taxes groceries at a reduced state sales tax rate of 1.225%. But again, local areas in Missouri are also allowed to tax groceries.
Learn more about how combined sales tax rates work here.
Some states, like Oklahoma, tax all grocery items but allow for exceptions for nonprofits purchasing and selling grocery items.
Are all groceries tax exempt?
Not everything sold at a grocery store qualifies for a sales tax exemption. As with all things sales tax, each state gets to make their own rules and laws, and that includes which items are considered grocery items and thus tax exempt.
Many states’ laws say that anything that can be bought with either state or federal Supplemental Nutritional Assistance Program (SNAP) benefits (AKA food stamps) qualifies as groceries and are tax exempt.
But generally food seen as unhealthy or without nutritional value, such as candy and soft drinks are still taxed, even in states where groceries are generally tax exempt. Alcoholic beverages are generally always taxable and may also be subject to an additional excise tax.
Prepared food (sometimes also called “food ready to eat”) is generally always subject to sales tax. But states can get so granular that sometimes they consider food items “ready to eat” if they are sold with utensils, but “grocery food” (and therefore non-taxable) if they are sold without utensils.
The key takeaway is, if you sell foods and beverages and have sales tax nexus in a state where groceries are non-taxable, always double check to be sure that the actual items you sell qualify for the state’s sales tax exemption.
Sales tax by State: Are Groceries Taxable?
Below is a list of states and how they tax grocery items. Be sure to understand each state’s definition of “groceries” when deciding when (and when not) to collect sales tax on food items.
| State | Are groceries taxable? | Notes |
| Alabama | Yes | - |
| Alaska | No, but local tax rates may apply | Alaska has no statewide sales tax, but local tax rates may apply |
| Arizona | No | - |
| Arkansas | Yes, but at a reduced rate | Grocery items are taxed at a rate of 1.5% plus any applicable local sales tax |
| California | No | - |
| Colorado | No | - |
| Connecticut | No | - |
| Florida | No | - |
| Georgia | No, but local tax rates may apply | Local areas (counties, cities, etc.) in Georgia are allowed to require sales tax on groceries |
| Hawaii | Yes | - |
| Idaho | Yes | - |
| Illinois | Yes, but at a reduced rate and local tax rates may apply | Groceries in Illinois are taxed at a reduced rate of 1%. Illinois local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (Illinois Revenue) Important note: The 1% state sales tax on groceries is temporarily suspended from July 1, 2022 through June 30, 2023. |
| Indiana | No | - |
| Iowa | No | - |
| Kansas | Yes, but at a reduced rate and local tax rates may apply | Starting January 1, 2023 groceries in Kansas are taxed at a reduced state rate of 4%. This rate will reduce to 2% on January 1, 2024 and then 0% on January 1, 2025. Kansas local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (Kansas Department of Revenue) |
| Kentucky | No | - |
| Louisiana | No | - |
| Maine | No | - |
| Maryland | No | - |
| Massachusetts | No | - |
| Michigan | No | - |
| Minnesota | No | - |
| Mississippi | Yes | - |
| Missouri | Yes, but at a reduced rate and local tax rates may apply | Groceries in Missouri are taxed at a reduced rate of 1.225%. The reduced rate applies to all types of items that can be bought with SNAP benefits (aka food stamps) Missouri local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (Missouri Department of Revenue) |
| Nebraska | No | - |
| Nevada | No | - |
| New Jersey | No | - |
| New Mexico | No | - |
| New York | No | - |
| North Carolina | No | - |
| North Dakota | No | - |
| Ohio | No | - |
| Oklahoma | Yes | Groceries purchased using food stamps are tax exempt. Some nonprofits serving the needy or elderly may purchase and sell grocery food tax free. (Oklahoma Tax Commission) |
| Pennsylvania | No | - |
| Rhode Island | No | - |
| South Carolina | No, but local tax rates may apply | Groceries that can be bought with federal food stamps are tax exempt at the state level. South Carolina local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (South Carolina Department of Revenue) |
| South Dakota | Yes | - |
| Tennessee | Yes, but at a reduced rate and local tax rates may apply | Groceries in Tennessee are taxed at a reduced state sales tax rate of 4%. Tennessee local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (Tennessee Department of Revenue) |
| Texas | No | - |
| Utah | Yes, but taxed at a reduced rate and local tax rates may apply | Groceries in Utah are taxed at a reduced state rate of 1.75%. Utah local areas (cities, counties, etc.) are allowed to require sales tax on groceries. (Utah State Tax Commission) |
| Vermont | No | - |
| Virginia | No, but local taxes apply | The Virginia sales tax on groceries was abolished starting January 1, 2023 but the statewide local tax of 1% still applies. (Virginia Department of Revenue) |
| Washington | No | - |
| Washington DC | No | - |
| West Virginia | No | - |
| Wisconsin | No | - |
| Wyoming | No | - |
