At a recent MMBA Regional Meeting a member asked about taxing fruit juices.
According to the Minnesota Department of Revenue:Soft drinks
Soft drinks are taxable. The exemption for food products does not apply to soft drinks.
"Soft drinks" means nonalcoholic beverages in liquid form that contain natural or artificial sweeteners.
"Sweeteners" includes corn syrup, dextrose, invert sugar, sucrose, fructose, fruit juice concentrates, molasses, evaporated cane juice, rice syrup, barley malt, honey, and artificial sweeteners.
Soft drinks do not include beverages that contain milk or milk products; soy, rice, or similar milk substitutes; or greater than 50 percent vegetable or fruit juice by volume.
Product labels should be reviewed to determine if the product falls within the guidelines of a taxable soft drink.
Taxable soft drinks include:
- bottled or canned water that contains sweeteners
- coffee and tea drinks that contain sweeteners
- fruit ades, drinks, or nectars that contain sweeteners and have 50 percent or less fruit juice or no fruit juice percent shown on label
- nonalcoholic beer or near beer, such as O'Doul's and Sharps (contains barley malt, a sweetener)
- Pedialyte
- sports drinks (Gatorade, Powerade, etc.)
- soda pop
- sparkling Catawba juice containing sweeteners and 50 percent or less fruit juice
Examples of nontaxable items:
- apple cider
- beverage powders or concentrates
- bottled or canned water that does not contain sweeteners
- coffee or tea beans, grounds, leaves, or powders
- nutritional drinks that contain milk or milk substitutes
- FrappuccinoŽ (contains milk)
- fruit or vegetable juices that contain more than 50 percent juice by volume even if they contain sweeteners
- milk and drinks that contain milk
Bottled water
Unsweetened bottled water sold in any size container is exempt because it is a food product. This includes carbonated or non-carbonated water or flavored water if no sweetener is added. Delivery charges for non-taxable water are also exempt.
Bottled water is still taxable when sold through a vending machine or when the seller provides eating utensils.
