Food and food ingredients

From the 2024 DOR Tax Exemption Study

82.08.0293; 82.12.0293 - Food and food ingredients Description Food and food ingredients purchased for human consumption are exempt from sales and use taxes. The definition of food and food ingredients excludes alcoholic beverages, tobacco products, cannabis, useable cannabis, and cannabis-infused products. The exemption does not apply to soft drinks, bottled water, or dietary supplements, and prepared foods, except when furnished, prepared, or served as meals to certain qualified low-income, disabled, or senior citizens. Purpose To lessen the regressivity of the sales tax and to reduce the cost of essential items. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $1,311.100 $1,325.100 $1,338.100 $1,352.200 Local Taxes $590.000 $596.000 $602.000 $608.000 Repeal of Repealing this exemption would increase revenues. exemption Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 $1,214.900 $1,338.100 $1,352.200 Local Taxes $0.000 $546.000 $602.000 $608.000 Assumptions - This repeal takes effect July 1, 2024, and impacts 11 months of collections in fiscal year 2025. - Annual growth rate of 3% based on hi