17 NCAC 07B .2201          FOOD AND FOOD PRODUCTS

(a)  General. - All retail sales of food or food products are subject to applicable statutory State and local sales or use tax unless a statute exempts the sales from tax.  G.S. 105-164.13B lists the food that is exempt from State tax, but not the two percent local tax.

(b)  Exempt Cafeteria Food. - The schools, institutions, and organizations whose sales of food and meals are exempt under G.S. 105-164.13(26), (26a), or (27) are not required to register with the Department.  Therefore, unless one of these entities is otherwise required to register with the Department by reason of making other sales or purchases subject to the sales or use tax, it cannot furnish a Streamlined Sales and Use Tax Agreement Certificate of Exemption, Form E-595E, to its suppliers.  When making purchases of food to be sold, one of these entities that is not registered must give the supplier information to the effect that the food purchased is to be sold by the entity's school cafeteria or dining room, and the supplier must enter this information on its records and on the sales invoices.  Otherwise, the transactions may be subject to the tax.  Registered schools, institutions, and organizations must furnish a properly executed Streamlined Sales and Use Tax Agreement Certificate of Exemption, Form E-595E, to a supplier to purchase food without paying tax on the purchase.


History Note:        Authority G.S. 105‑164.4; 105-164.6; 105‑164.13; 105‑262; 105-467; Article 39; Article 40; Article 42; Article 43; Article 44; Article 46;

Eff. February 1, 1976;

Amended Eff. May 1, 2009; August 1, 2002; May 1, 1999; August 1, 1998; October 1, 1993; October 1, 1991; February 1, 1986; May 11, 1979.