Which supermarket sales of salad-bar items, repackaged deli salads, and packaged bakery products were taxable under Florida TAA 12A-021?

Plain-English summary

Salad-bar items were taxable at the two stores that provided tables and chairs because they were prepared foods sold for immediate consumption. At the salad-bar store without tables and chairs, those items were exempt when packaged without eating utensils.

The chicken, tuna, egg, and potato deli salads were taxable. Store employees repackaged customer-selected quantities, so the products did not satisfy the exception for food prepared off premises and sold in its original sealed container. Repackaging the salads also was not the statutory slicing of prepared food into smaller portions.

The bakery products were exempt because they were boxed, bagged, or placed in snap-shut containers and sealed with tape or an adhesive label in a manner consistent with off-premises consumption.

What this means for you

Prepared-food taxability can change with the store's eating facilities and the exact way a product is prepared, portioned, sealed, and supplied with utensils.

Common questions

Were all salad-bar sales treated alike? No. The stores with tables and chairs had taxable sales; the store without eating facilities had exempt sales when no utensils were packaged with the food.

Why were the deli salads taxable? They were repackaged by store employees rather than sold in the original sealed container, and the repackaging was not slicing.

Why were the bakery products exempt? Their sealed packaging showed an intention that customers consume them off premises.

Citations and references

• Fla. Stat. § 212.08(1) and Fla. Admin. Code r. 12A-1.011, as cited in the advisement.

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 12A-021

Original ruling text

Interim
Executive Director
Marshall Stranburg

QUESTION:

1. Whether the sale of salads, prepared both on and off the premises, are
   subject to sales tax when sold at a supermarket.
2. Whether sales of bakery products are taxable when sold in a supermarket
   when packaged in a manner consistent with the intention by the customer to
   consume the products off the seller’s premises.

ANSWER:
Salad Bar Items. Taxpayer’s sales of salad bar items are taxable at the two stores
that have tables and chairs because these items are prepared foods sold for
immediate consumption. Sales of salad bar items at the store that does not have
tables and chairs are exempt when packaged without eating utensils.
Deli Salads. Taxpayer’s sale of deli salads (i.e., chicken, tuna, egg, and potato) is
taxable because the salads are not prepared off the premises and sold in the original
sealed container. The exception for prepared food sliced into smaller portions
provided in s. 212.08(1)(c)9., F.S., does not apply because the repackaging of the
deli salads by store employees does not involve slicing.
Bakery Products. Taxpayer’s sales of the bakery products are exempt, since they
are packaged in a manner consistent with an intention by the customer to consume
the products off the seller’s premises.

September 13, 2012
Re:

Technical Assistance Advisement – TAA 12A-021
Deli Salads and Bakery Products
Taxpayer Name: XXX
Taxpayer ID Number: XXX
Taxpayer Name: XXX
Taxpayer ID Number: XXX
Taxpayer Name: XXX
Taxpayer ID Number: XXX
Taxpayer Name: XXX
Taxpayer ID Number: XXX
Taxpayer Name: XXX
Child Support Enforcement – Ann Coffin, Director  General Tax Administration – Maria Johnson, Director
Property Tax Oversight – James McAdams, Director  Information Services – Tony Powell, Director

www.myflorida.com/dor
Tallahassee, Florida 32399-0100

Technical Assistance Advisement
Page 2

Taxpayer ID Number: XXX
Sales and Use Tax
Section 212.08(1), Florida Statutes (F.S.)
Rule 12A-1.011, Florida Administrative Code (F.A.C.)

Dear XXX:
This response is in reply to your letter to the Department, dated XXX, in which you
are requesting the Department's issuance of a Technical Assistance Advisement
("TAA") pursuant to s. 213.22, F.S., and Chapter 12-11, F.A.C., regarding whether
deli salad and bakery products sold in a grocery store are subject to sales tax
imposed under Chapter 212, F.S. An examination of your petition has established
that you have complied with the statutory and regulatory requirements for issuance
of a TAA. Therefore, the Department is hereby granting your request for issuance
of a TAA.
As provided in Section 213.22(1), F.S., a technical assistance advisement may be
issued to a taxpayer who requests an advisement relating to the exemptions in
Section 212.08(1) or (2), F.S., at any time. Technical assistance advisements shall
have no precedential value except to the taxpayer who requests the advisement and
then only for the specific transaction addressed in the technical assistance
advisement, unless specifically stated otherwise in the advisement.
PRELIMINARY FACTS
Taxpayer is engaged in the business of operating a grocery store that includes a fullservice meat department, delicatessen, bakery, fresh produce department, and
seafood department. Three of the five stores operate a full service salad bar that
contains fresh produce “salad bar items” (e.g., lettuce, tomatoes, cucumbers, and
other items customarily offered on a salad bar). The other two stores do not offer
salad bar items. Of the three stores that offer salad bar items, two of the stores have
tables and chairs either inside or outside the store. There is no table service, and no
trays, plates, or other dishes or other tableware are offered at any of the stores.
Taxpayer also sells deli salads (chicken, tuna, egg, and potato) in the deli section of
the store. These salads are either prepared at the store (on-site salad) or by an
unrelated third party off the premises of Taxpayer (off-site salad). You state that
customers request particular amounts of the salads and store employees repackage
the salads according to these requests. You further state that the deli salad is not
sold as a part of a meal and is not packaged or sold with eating utensils. Eating
utensils are available inside each of the grocery stores in separate bins accessible by
the store customers. You state that it is the customary practice for the salad bar
items and the deli salads to be consumed off the premises.

Technical Assistance Advisement
Page 3

With regard to the bakeries, three of the five stores have their own bakery plants on
the premises, and these plants are used to supply bakery items to all five stores.
Approximately 95% of the bakery items are made at one of the three plants. The
remaining bakery items are purchased from unrelated third parties. Every bakery
item sold is packaged in a box with a lid, bag, or plastic container that snaps shut,
and is sealed with either tape or an adhesive label. None of the bakery items are
sold or served on trays, plates, dishes, or napkins. It is the customary practice at all
stores for the bakery items to be consumed off the premises.
REQUESTED RULING
You are requesting a ruling concerning whether the sales of salads from the salad
bar and deli are subject to sales tax, and whether the bakery items are taxable. It is
your contention that the salad bar items, the deli salads, and the bakery products are
exempt from sales tax as a food product under Section 212.08(1), F.S.
LAW
Pursuant to Section 212.08(1), F.S., there are exempted from tax imposed by this
Chapter, 212, F.S., food products for human consumption. The term "food
products," as defined in Section 212.08(1)(b), F.S., means edible commodities,
whether processed, cooked, raw, canned, or in any other form, which are generally
regarded as food. Food products include meat and meat products, baked goods, fish
and seafood products, vegetables and vegetable products, and fruit and fruit
products. In construing statutory exemptions from tax, the Department must follow
the fundamental rule of statutory construction established by the Florida Supreme
Court, which mandates that exemptions from, or exceptions to, taxing statutes are
special privileges granted by the legislature and must be strictly construed, "with
any doubt being resolved in favor of the state." State v. Dickinson, 286 So.2d 259
(Fla. 1974). See also United States Gypsum v. Green, 110 So.2d 409 (Fla. 1959);
Green v. Pederson, 99 So.2d 292 (Fla. 1957).
As provided in Section 212.08(1)(c)9., F.S., the exemption for food products does
not apply to food products cooked or prepared, whether on or off the seller's
premises, and sold for immediate consumption. This does not apply to food
prepared off the premises and sold in the original sealed container, or the slicing of
products into smaller portions. As provided in Section 212.08(1)(d)2., F.S., in
determining whether an item is sold for immediate consumption, there shall be
considered the customary consumption practices prevailing at the selling facility.
Pursuant to Rule 12A-1.011(4)(b), F.A.C., the exemption for food products does not
apply to food prepared for immediate consumption, as follows:

Technical Assistance Advisement
Page 4

1. Food prepared for immediate consumption is food prepared to a point
   generally accepted as ready to be eaten without further preparation and that
   is sold in a manner that suggests readiness for immediate consumption. In
   determining whether an item of food is sold for immediate consumption, the
   customary consumption practices prevailing at the selling facility shall be
   considered.
2. Examples:
   a. Potato salad is prepared and delivered to a dealer in bulk. The
   dealer repackages the potato salad into smaller containers. Because
   the potato salad is not sold in the original sealed container, the sale
   of the repackaged smaller containers of potato salad is subject to tax.
   b. A grocery store buys cold cuts in five-pound packages. The
   grocery store slices cold cuts for the customer according to the
   thickness and the amount the customer desires. The food is then
   packaged for sale to the customer. Because the cold cuts are sliced
   into smaller portions, the sale of the cold cuts is exempt from tax.

e. A supermarket prepares fruit and vegetable products into various
fresh salads for sale. When packaged without eating utensils and sold
as a grocery item, the sale of the prepared fresh fruit or vegetable
salad is exempt. When the prepared fresh salads are packaged with
eating utensils, such as with a fork and a napkin, the salad is a food
product prepared and sold for immediate consumption and is subject
to tax.With regard to the sale of baked goods from the bakery,
Section 212.08(1), F.S., exempts the sale of bakery products when
they are sold for consumption off the seller’s premises. As provided
in Rule 12A-1.011(3)(c)2., F.A.C.:
For the purpose of this paragraph, there shall be a rebuttable presumption
that the sale of bakery products by bakeries, pastry shops, or like
establishments that have eating facilities are taxable when:
a. Such bakery products are sold in quantities of five (5) or fewer
items; or
b. The bakery products sold, regardless of the quantity, are not
packaged in a manner consistent with an intention by the customer to
consume the products off the seller’s premises.

Technical Assistance Advisement
Page 5

As stated in Rule 12A-1.011(3)(c)3., F.A.C., bakery products that are sold,
regardless of the quantity, in packaging that is glued, stapled, wrapped, or sealed are
examples of packaging consistent with an intention by the customer to consume
products off the seller’s premises.
“Bakery products, excluding items sold as a hot prepared food products, that are
sold by bakeries, pastry shops, or like establishments that do not have eating
facilities are exempt.” Rule 12A-1.011(3)(d), F.A.C.
Great weight is given to a rule that has been in effect over an extended period of
time, unless it is clearly erroneous. State, Department of Commerce, Division of
Labor v. Matthews Corp., 358 So.2d 256 (Fla. 1st DCA 1978), Pan American
World Airways, Inc. v. Florida Public Service Commission, 427 So.2d 716 (Fla.
1983). Also, properly promulgated rules are presumptively valid. Agrico Chemical
Co. v. Department of Environmental Regulation, 365 So.2d 759 (Fla. 1st DCA
1978).
DETERMINATION
Salad Bar Items. Taxpayer’s sales of salad bar items are taxable at the two stores
that have tables and chairs because these items are prepared foods sold for
immediate consumption. Sales of salad bar items at the store that does not have
tables and chairs are exempt when packaged without eating utensils.
Deli Salads. Taxpayer’s sale of deli salads (i.e., chicken, tuna, egg, and potato) is
taxable because the salads are not prepared off the premises and sold in the original
sealed container. The exception for prepared food sliced into smaller portions
provided in s. 212.08(1)(c)9., F.S., does not apply because the repackaging of the
deli salads by store employees does not involve slicing.
Bakery Products. Taxpayer’s sales of the bakery products are exempt, since they
are packaged in a manner consistent with an intention by the customer to consume
the products off the seller’s premises.
This response constitutes a Technical Assistance Advisement under s. 213.22, F.S.
which is binding on the department only under facts and circumstances described in
the request for this advice, as specified in s. 213.22, F.S. Our response is predicated
on those facts and the specific situation summarized above. You are advised that
subsequent statutory or administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject similar future
transactions to a different treatment than expressed in this response.
You are further advised that this response, your request and related backup documents
are public records under Chapter 119, F.S., and are subject to disclosure to the public
under the conditions of s. 213.22, F.S. Confidential information must be deleted before
public disclosure. In an effort to protect confidentiality, we request you provide the
undersigned with an edited copy of your request for

Technical Assistance Advisement
Page 6

Technical Assistance Advisement, the backup material and this response, deleting
names, addresses and any other details which might lead to identification of the
taxpayer. Your response should be received by the Department within 15 days of
the date of this letter. If you have any further questions with regard to this matter
and wish to discuss them, you may contact me directly at (850) 717-7202.
Sincerely,
Richard R. Parsons
Tax Law Specialist
Technical Assistance & Dispute Resolution
(850) 922-4838
Record ID: 121463