Is candy taxed in indiana?

FOOD NOT SUBJECT TO TAX The term does not include tobacco, alcoholic beverages, sweets, dietary supplements, or soft drinks. Indiana sales tax does not apply to the sale of food and food ingredients if sold without heating and without vendor-provided eating utensils. And Pixy Stix? You can't seem to get much more empty calories than these scratched childhood memories. But they also come without sales tax.

Indiana considers foods that come in the form of bars, drops, or pieces to be candy. It's not this general understanding of what we all call candy. Indiana does not collect sales tax on purchases of most prescription drugs and food. Prepared foods are subject to special sales tax rates under Indiana law.

In most states, basic necessities, such as groceries, clothing, and medicines, are exempt from sales tax or are charged at a lower sales tax rate. Unprepared foods that you can buy at a grocery store are not considered taxable in Indiana. In addition to these foods, items sold to both farmers and contractors are not eligible for sales tax in Indiana. Sales tax exemption forms (as well as business sales tax identification requests, sales tax returns, and the full Indiana sales tax code) can be downloaded from the Indiana Department of Revenue here.

For more information on how these transactions and other more complicated situations are subject to Indiana sales tax, see the Indiana Sales Taxation FAQ page. If you buy products and the retailer does not charge you Indiana sales tax, for example, with online and out-of-state purchases, you are supposed to pay 7% sales tax (minus any foreign sales tax paid) for these items as the Indiana use tax. You are expected to voluntarily post your responsible purchases on an Indiana use tax return, which must be attached with the payment to your Indiana income tax return.

Josephine Halder
Josephine Halder

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