Does food preparation by restaurants and food retailers qualify for exemption?
Generally, items used to process food for sale by grocery stores, bakeries, and other food retailers do not qualify for exemption. However, there is a specific exemption for the sale of equipment to be used by a retail food vendor to manufacture or process bread or bakery goods for resale. To qualify for the exemption, the vendor must operate a substantial grocery or market business (as defined in Section 11-206(a) of the Tax-General Article) at the same location where the food is sold. The taxable price of each piece of exempt equipment must be at least $2,000. Can utilities and fuel qualify for exemption from sales tax? Yes. Sales of utilities and fuel qualify for exemption. However, the use of these items in operating administrative, commercial and storage facilities and in providing plant heating and air conditioning is not exempt. When utilities are sold through a single meter for both taxable and exempt uses, taxability is controlled by majority usage. The taxability of oil and c
