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Understand Sales Tax for Food & Beverage
Is food taxable in Georgia?
byAugust 5, 2020
If you sell groceries or meals in Georgia, it’s vital to understand when to (and when not to) charge sales tax on a transaction. Let’s dig in.
Are groceries taxable in Georgia?
Grocery items like produce, meat and bread are considered exempt from Georgia’s 4% statewide sales tax. Georgia defines “food” in Ga. Code Ann. §48-8-3(57).
Georgia considers “Food and food ingredients” to include “substances, whether in liquid, concentrated, solid, frozen, dried, or dehydrated form, that are sold for ingestion or chewing by humans and are consumed for their taste or nutritional value.”
For purposes of this exemption only, “Food and Food Ingredients” does NOT include (and thus the following are subject to both state and local taxes):
- Prepared Food;
- Alcoholic beverages (i.e., beverages suitable for human consumption and contain 0.5% or more of alcohol by volume);
- Dietary supplements;
- Tobacco; and
- Items ingested or chewed primarily for medical or hygiene purposes.Examples: cough drops, throat lozenges, breath strips, and over the counter medications.
However, the state allows local areas to choose to impose a sales tax on groceries.
For example, grocery buyers in Cherokee County, Georgia pay a 2% local sales tax on groceries, even though Georgia’s 4% statewide sales tax rate doesn’t apply.
Are meals taxable in Georgia?
Prepared meals, including food sold at restaurants or food trucks, are generally taxable in Georgia at the full state + local rates.
For example, say you park your taco truck in Atlanta. You’d be required to charge the Georgia 4% statewide tax rate plus any local rates (Fulton County, Atlanta city, special district tax, etc.) that apply.
Are beverages taxable in Georgia?
Beverages such as tea, coffee and soft drinks follow the same rules as grocery items in Georgia.
How to Always Collect the Correct Amount of Sales Tax in Georgia
Do you sell groceries, meals or beverages? Are you required to collect sales tax in Georgia? Then this may sound like a huge headache.
TaxJar is here to help.
With the TaxJar API, you can be sure you’re collecting the right amount of sales tax on every transaction. Our product tax codes ensure you do collect sales tax on that soft drink but don’t collect sales tax on that plain coffee drink.
Not to mention, most eCommerce businesses have nexus in multiple states. For example, groceries are taxable in some states, but non-taxable in others. Or, like Georgia, they are only taxed at the local rate in some jurisdictions. With TaxJar, you’ll collect the right amount of sales tax from every customer, in every state, every time.
Further food and meal taxability resources:
- Sales Tax by State: Are grocery items taxable?
- Sales Tax by State: To-Go Restaurant Orders
- Is the food I sell on my food truck taxable?
- Georgia Sales Tax Guide for Businesses
Ready to automate sales tax collection, reporting and filing? Click here for more on how TaxJar can take the headache out of sales tax in your food & beverage business.
Your food taxability checklist
Food and beverage taxability is complicated, and collecting and filing correctly can be difficult. Use this checklist to make sure you’re compliant.Download the checklist