Publication 840:(8/98):A Guide To Sales Tax For Drugstores .

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Note: Please see TSB-M-16(6)S, Sales and Use Tax Exemptionfor Feminine Hygiene Products, for information on recentlyenacted legislation that provides an exemption from sales anduse tax for feminine hygiene products.Publication 840 begins on page 2 below.

Publication 840A Guide To Sales TaxFor Drugstores andPharmaciesPub 840 (8/98)

Publication 840 (8/98)About This PublicationThis publication is a guide for owners, managers, and other operators of drugstores, pharmacies, andsimilar businesses. It contains a general discussion of how the New York State Sales andCompensating Use Tax Law applies to retail sales made by these establishments.The information contained in this publication will assist in answering questions generallyencountered in the operation of a drugstore or pharmacy. This information is current as of the printdate of this publication. In instances where there seems to be a discrepancy between theinformation presented in this publication and the Tax Law or regulations, the law andregulations govern.Using drugstore and pharmacy industry classifications as a guideline, the publication is set upalphabetically, by product category, and includes discussions of: BeveragesCigarettes and Tobacco ProductsCosmetics and ToiletriesDrugs and MedicinesFood and Food ProductsGeneral Merchandise (Auto Supplies, Housewares, Clothing, Etc.)Medical Equipment and SuppliesPet Accessories and SuppliesProsthetic AidsThis publication also contains information on topics such as:. Use of CouponsFood Stamp PurchasesSales to Exempt PurchasersSales for ResaleWhile the discussions of the general categories provide the general rule and exceptions relating tothe taxation of retail sales of particular products, it is important to remember that there are specialrules for exempt purchasers. For that reason, a section on exempt purchasers is included in thediscussion.While the information contained in this publication is not all-inclusive, it will provide you with ageneral overview of which retail sales are subject to sales tax and which are not.Telephone numbers and addresses for obtaining forms, publications, or other information appear onthe back cover of this publication.Page i

Publication 840 (8/98)Table of ContentsPart ITaxability of Product SalesPageAudio and Video . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2Automotive Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2Beverages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2Books . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Candy and Confections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4Cigarettes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4Cigars and Other Tobacco Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Cosmetics and Toiletries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Dietary Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Drugs and Medicines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Family Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8Feminine Hygiene . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9Food and Food Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9General (Miscellaneous) Merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Hair Care Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Health Supplements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Housewares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Medical Equipment and Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Nail Care Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12Newspapers and Periodicals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Packaged Medications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Pet Accessories and Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Prosthetic Aids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Part IIGeneral InformationMedical Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Coupons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Food Stamps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Exempt Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Resale Exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cigarette Dealers, Retailers, Wholesalers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Dealers of Cigars and Other Tobacco Products . . . . . . . . . . . . . . . . . . . . . . . . . . .Returns, Allowances, Bad Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Part III1616181920202122Product ListingsCosmetics and Toiletries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Exempt Foods and Beverages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Taxable Foods and Beverages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .General Merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Medical Equipment and Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Page ii2426272829

Publication 840 (8/98)Part ITaxability of Product SalesTable of ContentsAudio and Video . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Automotive Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Beverages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Books . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Candy and Confections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cigarettes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cigars and Other Tobacco Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cosmetics and Toiletries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Dietary Foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Drugs and Medicines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Family Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Feminine Hygiene . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Food and Food Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .General (Miscellaneous) Merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Hair Care Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Health Supplements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Housewares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Medical Equipment and Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Nail Care Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Newspapers and Periodicals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Packaged Medications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Pet Accessories and Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Prosthetic Aids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Page 1222344557789910101011111213131314

Publication 840 (8/98)Audio and VideoSales of audio and videoequipment are subject to salestaxAutomotive SuppliesSales of automotive supplies aresubject to sales taxBeveragesTaxability of the sale dependson type of beverage soldSales or rentals of audio and video equipment and supplies are subject to sales tax.This includes sales or rentals of: audio and video cleaning devicesblank audio and video cassette tapescompact discs and disc playersminiature cassette tapesprerecorded audio and video cassette tapesradios / boom boxestape players / recorderstelevisionsVCRs (video cassette recorders)video game systems / cartridgesportable cassette/radio players with headphonesSales of automotive supplies are subject to sales tax. This includes sales of: antifreezebrake fluidcar deodorizerscar polishcar waxcarburetor cleanerdry gasmotor oiltransmission fluidwindshield washer fluidThe taxable or exempt status of the sale of a beverage depends on the nature of thebeverage. This is true whether the beverage is sold in liquid, frozen, or solid form.The list below contains examples of some common beverages and gives the taxableor exempt status of the sale of each.TYPE OF BEVERAGETAXABLEAlcoholic beverages (beer, wine, liquor, etc.)xBottled waterxCarbonated beveragesxCarbonated waterxCoffeeEXEMPT*xCocktail mixes (such as Collins Mixers)CocoaxxPage 2

Publication 840 (8/98)TYPE OF BEVERAGEFruit drinks with less than 70% natural fruit juiceTAXABLEEXEMPT*xFruit juices with at least 70% natural fruit juicexMilkxSodas and soft drinks (colas, ginger ale, root beer, etc.)xSports drinks (e.g., Gatorade)xTeaxVegetable juicesxWine coolersx* For the sale of these beverages to be exempt from sales tax, the beverage mustbe sold in the same form, packaging, quantity, and condition as sold by food stores(such as grocery stores) that are not principally engaged in selling foods that areprepared and ready to be eaten. That is, the beverage must be sold in the sameform, packaging, quantity, and condition in which the manufacturer prepared it formarket. For example, the sale of a glass of iced tea is subject to sales tax, but thesale of a package of iced tea mix is not.In addition, the beverage must be sold for off-premises consumption. The sale ofany beverage that is intended for consumption on the premises where the beverageis sold is taxable, regardless of the type of beverage. Thus, otherwise exempt salesof these beverages will be subject to sales tax if the beverage is intended for onpremises consumption (for example, at a soda fountain, or at a table or a boothwithin the establishment).The sale of any beverage in a take-out container (such as a cup, glass, or sportsbottle) is also subject to sales tax.BooksSales of books, whetherhardcover or paperback, aresubject to sales taxThe sale of a publication that does not meet the definition of a newspaper orperiodical is subject to sales tax. (See page 13 for information on newspapers andperiodicals). Taxable sales include sales of: audio books (such as books on tape or compact disc)children’s booksbooks on health and dietcoloring bookscookbookshardcover novels, histories, biographies, etc.paperback novels, histories, biographies, etc.religious texts (for example, the Holy Bible, the Torah, and the Koran)television program listingstextbooksPage 3

Publication 840 (8/98)Candy andConfectionsSales of candy and confectionsare taxable unless the item ismarketed for use as a cookingingredientSales of candy and confections are subject to sales tax. (Confections arepreparations of fruits, nuts, popcorn, or grains in combination with chocolate, sugar,honey, candy, etc.)Exception. Sales of confections that are marketed for use in cooking are not subjectto sales tax. For example, sales of items advertised and sold for use in cooking andbaking are not subject to sales tax. The method used in packaging and advertisingproducts such as chocolate, including the kind and size of container used, will beconsidered in determining the primary use for which these products are sold.Examples of candies and confections on which tax must be collected when sold are: candy barscandy jelliescaramelchewing gumchocolatechocolate-coated nuts and raisinscoated candiescream candiesfudgeshard candyhoney-roasted nutsjelly beanslicoricemalted milk ballsnougatssugar-coated nuts and raisinstoffeeExamples of items which are not subject to sales tax when sold are: CigarettesRetail sales of cigarettes aresubject to sales taxchocolate morselsglazed fruitcandy sprinkles (jimmies)butterscotch morselsThe sales tax due on the sale of a pack or carton of cigarettes is determined bymultiplying the retail selling price of the cigarettes by the applicable state and localsales tax rate in effect in the locality in which the sale takes place. There is anexception for sales made in New York City. See the discussion under New YorkCity Rule below.Example: John Jones operates a neighborhood pharmacy in upstate New Yorkwhere the combined state and local sales tax rate is 7%. He sells many standardbrands of cigarettes for 2.50 per pack (composed of the minimum retail sales pricePage 4

Publication 840 (8/98)of 2.00 per pack, plus Mr. Jones’s markup of .50 per pack). Mr. Jones shouldcompute the sales tax on the cigarettes, and the total tax due, as follows:Selling price per packMultiply by tax rate (7%)Sales tax due on saleNew York City Rule 2.50x.07 .18In calculating the sales tax for sales made within New York City, the vendor mustfirst subtract the New York City excise tax (80 cents per carton, 8 cents per pack oftwenty cigarettes) from the retail selling price, and then compute the sales tax due.Example: Assume that Mr. Jones operates his neighborhood pharmacy in NewYork City, where the combined state and local sales tax rate is 8¼ %. Mr. Jonesshould compute the sales tax on the cigarettes, and the total tax due, as follows:Selling price per pack of 20 cigarettes 2.50Less: NYC excise tax on 1 pack of 20 cigarettes-.08Amount subject to sales tax 2.42Multiply by tax rate (8¼ %)x.0825Sales tax due on sale .20New York City consists of the boroughs of Bronx (Bronx County), Manhattan (NewYork County), Brooklyn (Kings County), Queens (Queens County), and StatenIsland (Richmond County).Registration RequirementsCigars and OtherTobacco ProductsRetail sales of tobaccoproducts are subject to salestaxCosmetics andToiletriesSales of cosmetics andtoiletries are subject to salestax, except sales of thoseproducts specifically designedto treat illnesses or diseasesAll dealers, wholesalers, or retailers of cigarette products must be licensed orregistered by the Tax Department. See page 20 for more information.Tobacco products include any cigar or roll for smoking (other than a cigarette)made in whole or in part of tobacco, and any other tobacco product ( other thancigarettes), intended for consumption by smoking, chewing, or as snuff. All retailsales of tobacco products are subject to sales tax.All dealers, wholesalers, or retailers of tobacco products must be licensed,appointed, or registered by the Tax Department. See page 21 for more information.Sales of cosmetics and toiletries are subject to sales tax, even though there may bemedicinal ingredients in the products. Cosmetics are items used by human beingsfor cleansing, beautifying, promoting their attractiveness, or altering theirappearance. Toiletries are items customarily used for grooming purposes.Exception: Sales of products that are specifically designed to be used in the cure,mitigation, treatment, or prevention of illnesses or diseases in human beings are notsubject to sales tax. For example, the sale of styptic pencils and creams that arerecommended for stopping blood flow is exempt, as is the sale of peroxide that isrecommended for use as an antiseptic or for other medicinal purposes. Thefollowing table contains examples of taxable and exempt cosmetics and toiletries.Page 5

Publication 840 (8/98)ProductTaxableAntiperspirantsxBaby oil, powder, shampoo, lotionxBody creams, lotions, makeup, oils, powder, rubs, etc.xExemptDandruff preparationsxDeodorantsxHair coloring preparations, including peroxide used forbleaching hairxHair shampoos, conditioners, cream rinses, dressings, spraysxHair styling products (e.g., permanent kits, mousse, gels,sprays, brushes, combs, picks)xLip products (e.g., lipstick, liquid lip color, lip pomade)xMen’s hair dressing productsxMakeup (eye, face, body)xNail care products ( e.g., manicure implements, nail polish,polish remover)xOral hygiene products (toothpaste, mouthwash, dental floss,etc.)xPersonal cleanliness products (e.g., soap, bubble bath, talcumpowder)xShaving products (e.g., aftershaves, depilatories, and preshave products)xSkin care products (non-medicated)xSunscreens with an SPF factor of 2 or greaterxNote: Generally, products that contain coloring, perfume, or similar additives areconsidered to be cosmetic or toiletry products, and the sale of such products issubject to sales tax. For example, sales of lip products that are colored orperfumed, such as lipstick, are subject to sales tax. Sales of lip products that areuncolored, unscented, and recommended for use in treating lips, such as a productfor treating cold sores, are not subject to sales tax.See pages 24 and 25 for a more detailed listing of cosmetics and toiletries.Page 6

Publication 840 (8/98)Dietary FoodsSales of dietary foods areexempt from sales taxSales of infant food and infantformula are not subject to salestaxDrugs andMedicinesAll sales of drugs andmedicines for use by humanbeings are exempt from salestaxA dietary food is any food that purports to be or is represented to be for specialdietary use as a food for humans. The labels of dietary foods should bear astatement of the dietary properties upon which the product’s use is based. Sales ofdietary foods are not subject to sales tax.A food fabricated from two or more ingredients which purports to be or isrepresented to be for special dietary use, such as a food for infants, should containon the label the common or usual name of each such ingredient including spice,flavoring, and coloring. A food for special dietary use for infants by reason of itssimulation of human milk or its suitability as a complete or partial substitute forhuman milk should contain information on the label about its content of moisture,protein, fat, carbohydrate, minerals, calories and vitamins. Sales of infant (baby)food and infant formula are not subject to sales tax. See page 9 for moreinformation on the sale of food and food products.Sales of drugs and medicines are exempt from sales tax if the drug or medicine isintended for use, internally or externally, in the diagnosis, cure, mitigation,treatment, or prevention of illnesses or diseases in human beings. Drugs andmedicines are products, whether or not a prescription is required for their purchase,that are recognized as drugs or medicines in either the United States Pharmacopeia,the Homeopathic Pharmacopeia of the United States, or the National Formulary.The base or medium used to contain the drug or medicine (such as oil, ointment,cream, talc, or alcohol), and the medium used for delivery of the drug or medicine(such as disposable wipe, atomizer, syringe, or saturated pad) will not affect itsexempt status. Drugs and medications are classified as either: prescription drugs and medicines; non-prescription drugs and medicines (commonly called packaged medication);or other medicinal products.Prescription drugs andmedicinesPrescription drugs and medicines are products that are ordinarily used under thesupervision of a medical practitioner licensed by law. The category includes, forexample, antibiotics, barbiturates, narcotics, and other controlled substances.Non-prescription (packaged)drugs and medicationsNon-prescription drugs and medicines are products that are listed in either theUnited States Pharmacopeia, the Homeopathic Pharmacopeia of the United States,or the National Formulary, and that are intended for use in the diagnosis, cure,mitigation, treatment, or prevention of disease in humans. Sales of non-prescriptiondrugs and medicines are exempt from sales tax. Non-prescription drugs andmedicines include packaged medications such as: analgesics antacids antihistaminesPage 7

Publication 840 (8/98) antisepticsaspirinboric acidburn remediescough and cold remediesdandruff preparationsdiarrhea remedieshemorrhoid medicationsinsulinpain relieversproducts used to kill lice that infest humansproducts that prevent or treat mange or ringworm in humansproducts that are intended as a hair regrowth treatment for use by human beingswho experience hair loss or gradually thinning hair vaginal infection remediesOther medicinal productsOther medicinal products are those used (internally or externally) by humans forthe preservation of their health, and products (other than food) that are intended toaffect the structure or a function of the human body. Such products, which are notordinarily considered drugs or medicines, include: acne preparationscastor oil and cod liver oilcontact lens preparationseye dropslaxativeslip products that treat lips for exposureproducts that treat nicotine withdrawal symptomsproducts that prevent athlete’s foot or other fungus infectionsSales of these products are also exempt from sales tax.Sales of drugs and medicinesfor treatment of non-humansare generally subject to salestaxSales of drugs and medicines that are intended for use in treating non-humans (suchas birds, dogs, cats, and reptiles) are subject to sales tax regardless of whether or nota prescription is written for such drug or medicine. See, however, the exception forguide, hearing, and service dogs on page 13, under Pet Accessories and Supplies.Family PlanningSales of family planning products, whether by prescription or over-the-counter, areexempt from sales tax. Examples are:Sales of family planningproducts are exempt from salestax birth control pillscondomscontraceptive creamscontraceptive foamscontraceptive jelliesfemale contraceptive spongespessariesvaginal suppositoriesPage 8

Publication 840 (8/98)Feminine HygieneSales of feminine hygieneproducts are generally subjectto sales taxFeminine hygiene products are generally used to control a normal bodily functionand to maintain personal cleanliness. Sales of these products are, therefore,generally subject to sales tax (see exception below). Examples are: douchessanitary napkinstamponsvaginal creams, foams, ointments, jellies, powders, and sprays (other thancontraceptive creams, foams, ointments, and jellies)The exception is for thoseproducts that are used to treata specific medical conditionException: If the product is intended to function as a treatment for a specificmedical condition, then the product may be sold tax exempt. For example, the saleof a product that is used to treat a vaginal infection is exempt from sales tax.Food and FoodProductsSales of food and food products for human consumption are exempt from sales tax.The phrase “food and food products” includes:Sales of food and foodproducts for humanconsumption are not subject tosales tax cereals and grain products (e.g., bran, oats, grains)chocolate (for cooking purposes)meat and meat productsfrozen meals and dessertsnuts and nut productsbaked goods and snacks (except candy and confections)oils, fats, and shortenings (e.g., cooking oil, salad oil, lard)sweetening agents (e.g., sugar and sugar substitutes)food coloring, preservatives, and flavoring preparationsspices, herbs, seasonings, dressings, relishes, sauces, gravies, and condimentsbaby foodsException: Sales of food are subject to sales tax when the food is sold forconsumption on the premises where the sale is made. Sales of prepared foods suchas sandwiches are also subject to sales tax, whether sold for on- or off-premisesconsumption. Moreover, all sales of heated foods are also subject to sales tax.Sales of dieting aids, dietsubstitutes, and supplementsare not subject to sales taxSales of dieting aids, diet substitutes, diet supplements, and dietary foods are notsubject to sales tax.See pages 26 and 27 for a more detailed listing of exempt and taxable food items.Sales of exempt and taxableitems together as a single unit(such as gift baskets) aresubject to sales taxWhen taxable tangible personal property is sold in combination with nontaxablefood items as a single unit, the entire charge is subject to sales tax unless the priceof the exempt components are separately stated. Therefore, the sale of items suchas gourmet gift baskets which contain fruits, nuts, cheese, cider, smoked meats, andcandy is subject to sales tax on the full selling price of the item, unless the price ofthe nontaxable food items are separately stated. This rule also applies to food soldin decorative tins, decorative glass containers, and similar containers.Page 9

Publication 840 (8/98)General(Miscellaneous)MerchandiseSales of general merchandiseare subject to sales taxSales of general merchandise are subject to sales tax. General merchandise includessuch items and categories as: artificial treescameras and film (including film processing services)clothingcotton balls, swabs, squareselectrical applianceselectronics (record, tape, and compact disc players)eyeglasses (non-prescription)flowers and plantsgift wrapgreeting cardshair accessorieshardwarehosiery (stockings, socks)household products (e.g., detergents, paper towels, waxes, etc.)housewares (e.g., lawn furniture, kitchenware, etc.)ice (cubes, blocks)jewelrypet foods, pet medications, and pet supplies *school suppliesstationery suppliessunglasses (nonprescription)toyswriting implements* See the exception on page 13 for such items used in caring for guide, hearing,and service dogs.Hair Care ProductsSales of hair care products aregenerally subject to sales taxExceptions are medicinaldandruff preparations and hairrestorativesHealth SupplementsSales of vitamins and mineralsare not subject to sales taxHair care products are, like cosmetics and toiletries, used for cleansing, beautifying,promoting one’s attractiveness, altering one’s appearance, and grooming. As aresult, the sale of hair care products is generally subject to sales tax.Exception. Sales of all dandruff preparations, including dandruff shampoos, areexempt from sales tax if the preparation contains a recognized drug or medicine thatis listed in the United States Pharmacopeia, the Homeopathic Pharmacopeia of theUnited States, or the National Formulary. In addition, sales of products (such asRogaine) that are intended as a hair regrowth treatment for use by individuals whoexperience hair loss or gradual thinning of the hair are exempt from sales tax.Health supplements are products that are intended to substitute for natural food, orsupplement natural food in the ordinary diet. Sales of health supplements (such asvitamins and minerals) are not subject to sales tax.Page 10

Publication 840 (8/98)The label for the vitamin or mineral product should bear a statement of theproportion of the minimum daily requirement or daily requirement supplied by theproduct, when the product is consumed in a specified quantity during a specifiedperiod by infants, children, or adults. For example, the statement on the label mayread “One ounce provides 10% of the minimum daily adult requirement (or MDR)of vitamin B1.” The statement on a label for a mineral product may read “Oneounce provides 5% of the minimum daily adult requirement (or MDR) of iron.”If the nutritional value of the product has not been established, then the label for theproduct should contain a statement of the quantity of the vitamin or mineralprovided by a specified dosage, and the statement “The need for (name of vitaminor mineral) in human nutrition has not been established” or a similar statement.HousewaresAll sales of housewares aresubject to sales taxMedical Equipmentand SuppliesSales of medical equipmentand supplies are exempt unlesssold to a provider of a medicalserviceAll sales of housewares are subject to tax. This includes sales of: bakewarebarbecue grills and accessoriesbeverage containerscutlerydrinking glassesflatware (table knives, spoons, forks)glassware (ornamental, novelty, etc.)kitchen appliances and gadgets (dicers, slicers, etc.)kitchen towelskitchen utensilsmicrowave cookwarepanspaper plates and cupsplastic utensilspotssilverwaretable linen (tablecloths and napkins)tableware (utensils such as china, glass, or silver for table use)Sales of medical equipment and suppl

The taxable or exempt status of the sale of a beverage depends on the nature of the beverage. This is true whether the beverage is sold in liquid, frozen, or solid form. The list below contains examples of some common beverages and gives the taxable or exempt sta