Saturday, June 11, 2011

Collecting Sales Tax on Weekly Cookie/Popcorn Sales

Our PTA has a cookie sale every week and sells other snacks (candy and popcorn) during sporting events.  We also sell spirit wear (tee shirts and sweat shirts with the school logo) during the fall.   Should we be collecting sales tax on these sales?

As long as the spirit wear sale is for a defined, limited period, it would be considered a periodic fundraising event, and sales at such events are not subject to the sales tax.  Sales at a “regular place of business” are taxable, but certain food items are themselves exempt from sales tax.  Because the cookie sales occur on a regular schedule, they are considered to be a “regular place of business” but bakery items such as cookies are exempt from the sales tax, so the answer there is also no. 

The sales at sporting events would also probably be considered a “regular place of business” because they occur repeatedly throughout the school year, but some items (such as candy and fresh fruit) are exempt, and other items (such as popped popcorn) are not exempt.   To find out whether specific items are subject to the sales tax, you can contact the Department of Revenue’s Telephone Information Center at 1-800-647-7706.