18 Wacky Sales Tax Laws

By Cathie Ericson

6 min read

“Wacky” and “taxes” don’t often go together in the same sentence, unless you’re talking about wacky sales tax laws—and those we have by the bundle. While your payroll taxes and estimated taxes are no laughing matter, we thought you might enjoy some of these examples of government at its finest.

1. Cake Decorating Tax in California

Ever accidentally bite into a cake decoration and go, “Oh, that’s not edible?” Well, if you did, you probably paid for it in more than tooth pain. That’s because if more than 50 percent of the total retail cost of a bakery item consists of non-edible decorations, then a tax is applied to the retail selling price.

2. Fresh Fruit Tax in California

California gets you on the good-for-you stuff, too. If you were delighted to see some healthy choices in your vending machine, just know they will cost you. While you don’t typically have to pay sales tax on fresh fruit in California, it kicks in at a whopping 33 percent if you purchase your apple or banana from a vending machine.

3. Litigation Tax in New York

Suing someone in New York? Get in line, but it will cost you. Fortunately, at only $25, it will probably be the cheapest part of your case. This tax is due from any New Yorker involved in criminal or civil proceedings.

4. Bottle Bill in Oregon

Those Oregonians deserve to pay $0.10 per container (raised from $0.05 in April 2017), given that they have zero sales tax. (Zero. As in none.) They pioneered the “Beverage Container Act” which will cover all beverages except wine, liquor, milk and milk substitutes by 2018.

5. Bottled Water Tax in Washington

While many states are enacting a “soda tax” on sugary beverages in an attempt to help citizens make better choices, Washington state seems to be going the opposite direction. They have a sales tax on bottled water, which they define as “water that is placed in a safety sealed container or package for human consumption.” Making the law even wackier: You can be exempt if you purchase bottled water with a prescription. (Please, doc, I really want to avoid that ten cents!)

6. Pet Tax in Durham, North Carolina

As if your purebred lab wasn’t expensive enough, residents pay a tax on pets, specifically because they’re considered to be “personal priority.” (Your aloof cat might beg to differ.) The city rewards responsible owners, charging only $10 for spayed or neutered animals, versus $75 for those that are not.

7. Lid and Napkin Tax in Colorado

Want a straw and lid with your drink? A napkin with your burger? That will cost you. But don’t worry: they’ll throw in the disposable cup, utensils and plates for free. That’s because they differentiate between essential and nonessential food-packaging items—although we take great exception to the fact that napkins are considered nonessential.

8. Spendy Boots Tax in Texas

Wait, what’s a proper Texan without fancy boots? Someone who is also not an extra 8 percent poorer from sales tax, if those boots were bought during Texas’ annual “Sales Tax Holiday,” when items like clothing and footwear under $100 are exempt. They’d pay the tax every other day, of course, but it just feels wrong to exempt those with champagne taste.

9. Fur Tax in Minnesota

Yep, this is fur-real in Minnesota – you’ll pay 6.5 percent tax if the amount of fur on a piece of clothing is three times or more prevalent than the next most-used material.

10. Sparkler Tax in West Virginia

If you’re celebrating Independence Day in West Virginia, you might be fired up over the so-called “sparkler tax,” which also affects fireworks that “emit shower, sparks or noise.” So, all fireworks then?

11. Pumpkin Tax in New Jersey

Decorating with pumpkins? Smashing! But, be warned: you’ll have to pay a sales tax if they’re not being used as food. That means there’s no tax if you’re using your pumpkins to make an actual pumpkin spice latte. (Just kidding – there’s no actual pumpkin in most PSLs, we’re guessing!) Make that pumpkin pie. No tax.

12. Holiday-Themed Tax in Texas

Another holiday, another complex decorating rule. In Texas, you can hire someone to deck your halls without incurring sales taxes if they are using decorations you’ve previously bought, rather than buying your trimmings from them.

Also, you’ll incur a Santa tax some of the time, but it doesn’t depend on whether you’ve been naughty or nice. If you are buying a letter from Santa (maybe, say, he needs a little bribe to put you on the nice list), then be prepared to tack on a tax. But, the phone call from the Big Guy in Red can come untaxed.

13. Ice Tax in Arizona

Your ice, ice baby is going to be taxed differently whether it comes in block or cube format. Ice cubes are considered food, so no tax. Ice blocks are not food, so tax. Considering how hot it can get in Arizona, you might consider stocking up (tax-free) on ice blocks as chairs.

14. Candy Tax in Connecticut

Does your candy contain flour? Then it’s actually not really candy and doesn’t get taxed. Other treats that don’t have flour are taxed. Seems like a gluten tax to us, no?

15. To-Go Food in Michigan

If you’re taking your food “for immediate consumption,” it’s going to take an extra bite out of your wallet in the form of a sales tax. The items that are considered “for immediate consumption” are a veritable buffet of confusion, from deli trays (yes) to deli items sold by weight, such as potato salad, cole slaw and sliced meats (no). Oh, unless you bought them off the salad bar, then, yes.

16. Sliced Bagels in New York City

Bring your own knife to avoid being subject to a tax on a bagel that has been sliced or otherwise changed from its plain, delicious, bagel form. Specifically, the tax kicks in when bagels are “sold heated… for consumption on the premises, or [if they have] been prepared by the seller and [are] ready to be eaten, whether for on-premises or off-premises consumption.” Got it!

17. Body-Altering Tax in Arkansas

You can’t alter your bagel in New York free of charge. You also can’t alter your body (so to speak) in Arkansas without inflicting a 6-percent sales tax, which applies to tattoos, body piercings and electrolysis.

18. Playing Card Tax in Alabama

Get ready to deal out $0.10 extra for those playing cards if you buy them in Alabama. A deck is considered “54 cards or less,” so you might as well seek out a deck with the jokers intact to get what you’re paying for.

And…One Sales Tax You Might Not Have To Pay

Sick of all the extra taxes on oddball items? Well, then live long and prosper! That’s right, if are 100 or older and you live in New Mexico, you are exempt from state income tax.

Sales Tax: Done for You

QuickBooks takes the pain out of calculating sales tax. We’ve done the math for you on thousands of state, city, and county sales tax rates around the U.S. Be confident that you’re collecting the right amount of tax on each and every sale. Learn more and try QuickBooks free today.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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