Are Food and Meals subject to sales tax?
While Arkansas' sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of food and meals in Arkansas, including catering and grocery food. To learn more, see a full list of taxable and tax-exempt items in Arkansas.
In the state of Arkansas, any gratuities that are distributed to employees are not considered to be taxable.
In the state of Arkansas, any food or food ingredients taxed will be taxed at a reduced state rate of 1.5%. Some food items are considered to be ineligible for a reduced rate will be taxed at the regular state rate. In cases such as these, the state rate will fall from 1.5% to 0.125%, so long as certain budget conditions will be met.
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