New York, NY – According to records, a slew of New York City’s major markets and cafes were cited by inspectors in 2013 for improperly charging patrons sales tax on selected bakery, bread and other items that are non-taxable under current tax laws.
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NYPOST.com (http://bit.ly/1rCIgtx) reports that heavy hitters like Key Food, ShopRite, Whole Foods, Western Beef, D’Agostino’s, Trader Joe’s, Fairway, Gristedes and Met Foodmarkets were all among the 212 sales tax violations issued by inspectors during 2013.
According to insiders, ambiguity in current state sales tax laws may be at fault for many of the mix-ups.
For instance, a plain bagel sold “as is” is not taxable under current policy, but adding a butter to the bagel changes its status, making it taxable.
Fines of the violations begin at $350, with second offenses hitting the $500 mark.
In some instances servers and store employees are confusing policy, such as a server at Bouchon Bakery in Rockefeller Center who mistakenly taxed a customer for a croissant as “bread with butter.”
A rep for the Tax Department said a good rule of thumb is that “Baked goods are generally exempt from sales tax unless they’re served warm or in a fashion where they’re ready to be eaten such as on a plate.”
It’s time to simplify the tax code.
‘Confusion rhymes with government.’
The NY Post article is pretty vague on one key point, namely that (for just about all of them) the retailers aren’t keeping that money but are simply handing it over to the State. (There’s one company there which, per the article, sound like it may have been pocketing the cash).
So it’s the confused mess that NYS Tax authorities have set up that’s causing this problem.
– Note that nowhere do we see any hint of a suggestion that NYS will refund that windfall… They could, in a better world, kick it back to the stores which could then give five percent discounts for a week. Or something. Or another.