SALES TAX ON SODA MISAPPLIED TO SELTZER AT GROCERY AND CONVENIENCE STORES

From Vermont Business Magazine, September 7, 2015

Sam Frank of Orange buys and drinks a lot of seltzer. He calls the drink a healthier alternative to soda, as it has no added sugar or sweeteners.

So when Vermont’s newly implemented soda and sweetened beverage sales tax was applied to a black cherry Schweppes seltzer Frank purchased at an Irving convenience store in South Barre last week, he said he was confused.

“It was kind of expensive, so I asked, ‘Why is this so much?’ and they said ‘Well, we have to tax it,’” Frank recalled. “I said, ‘I don’t think so.’”

While Schweppes sells drinks that do qualify on the state’s list of taxable beverages, Frank’s favorite seltzer is concocted simply of carbonated water and natural flavors.

Guidelines issued by the Tax Department state that a drink is not taxable if it is “plain or flavored club soda or seltzer water with no sweeteners.”

Frank said the sales tax has been improperly applied to him at a number of stores over the past weeks, and provided VTDigger with a receipt from a Cumberland Farms store that applied the tax to an unsweetened black cherry seltzer.

Jim Harrison, president of the Vermont Retail and Grocers Association, described a similar experience he had while purchasing unsweetened Polar seltzer at a Price Chopper outlet.

“I called the headquarters, talked to the person and they were going to correct it,” he said.

Harrison said the confusion surrounding what beverages are and aren’t taxable is the result of Vermont’s membership as a streamlined sales tax state. The Green Mountain state is one of 24 states that share the same definitions for all taxable items, from clothing to computers.

For the full article please visit: http://vtdigger.org/2015/09/07/sales-tax-on-soda-misapplied-to-seltzer-at-grocery-and-convenience-stores