Food Tax CTJ FAQ

Q:How many states tax groceries under their general sales tax?

A: As of April 2004, 16 states include sales of groceries in their state general sales tax base. 29 states and the District of Columbia exempt groceries from the state sales tax, and 5 states do not levy general sales taxes at the state level.

Half a dozen states have moved toward exempting groceries in the past decade.

Georgia phased out its food tax between 1996 and 1998;
North Carolina phased out its tax between 1997 and 1999;
Missouri lowered its food tax from 4.225% to 1.225% in 1997;
Virginia gradually phased in a cut in the state sales tax on food from 3.5% to 1.5%, starting in 2000;
Louisiana eliminated its state sales tax on food in 2002.
New Mexico passed legislation in 2004 which exempts groceries effective January 1, 2005.

Taxation of Groceries on the State Level
No Sales Tax	# of States	State Names
No Sales Tax	5	AK, DE, MT, NH, OR
Groceries Taxable at Normal Rate	12	AL, AR, HI, ID, KS, MS, OK, SC, SD, UT, WV, WY
Groceries Taxable at Reduced Rate	4	IL, MO, TN, VA
Groceries Exempt	30	AZ, CA, CO, CT, DC, FL, GA, IN, IA, KY, LA, ME, MD, MA, MI, MN, NE, NV, NJ, NY, NC, ND, OH, PA, RI, TX, VT, WA, WI

Of the 12 states that apply the regular sales tax rate to groceries, five states (Idaho, Kansas, Oklahoma, South Dakota, and Wyoming) allow a special "sales tax credit" designed to rebate sales taxes paid by low-income taxpayers. This means that only seven states-- Alabama, Arkansas, Hawaii, Mississippi, South Carolina, Utah, and West Virginia-- currently tax food without providing any form of low-income credit to offset this regressive tax.

Last Updated 4/30/2004

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