Are retail sales of herbal fiberblend and barley green supplements subject to Kansas sales tax?

Plain-English summary

A company that already holds a Kansas sales and use tax account asked whether it must collect tax on two new products - (1) herbal fiberblend and (2) barley green supplements - and enclosed the product labels. The Department ruled both products are taxable.

Kansas taxes food and food products. The Department explained that "States that exempt food sales may exempt many or all of your herbal products," but "[u]nlike these states, Kansas taxes retail sales of food and food products." So a food-based supplement gets no food exemption in Kansas.

Kansas also taxes over-the-counter medicines. "Similarly, unlike some states, Kansas taxes sales of over-the-counter medicines." Whether the supplements are viewed as a food product or as an over-the-counter remedy, Kansas reaches them.

No exemption applies. The Department's conclusion: "Therefore, there are no Kansas exemptions that apply to your products," and "the two products are subject to Kansas tax." It noted it had "written a number of other opinion letters that reach a similar conclusion about retail sales of herbal supplements."

Bottom line: herbal fiberblend and barley green supplements are taxable in Kansas because the state taxes retail sales of both food/food products and over-the-counter medicines, and no exemption covers them.

What this means for you

Retailers of supplements, vitamins, and herbal products

In Kansas, herbal and dietary supplements are taxable. Do not assume a "food" or "health product" exemption applies - Kansas (as of this 2001 ruling) taxed retail sales of food and food products, and there is no exemption for these supplements.

The answer does not depend on how the product is labeled

Whether the supplement reads as a food product or an over-the-counter remedy, Kansas taxes both categories, so the classification did not change the result here.

Confirm current Kansas food-tax rules for your sale date

This ruling reflects Kansas law in 2001. Kansas food-sales-tax treatment has changed over time, so verify the rules in effect for the period of your sales; the point that stands is that these herbal supplements were not exempt.

Common questions

Q: Are herbal supplements taxable in Kansas?
A: Yes. The Department ruled that herbal fiberblend and barley green supplements are subject to Kansas sales tax, with no exemption applying.

Q: Why don't they qualify for a food exemption?
A: Because Kansas (unlike some states) taxed retail sales of food and food products, and it also taxes over-the-counter medicines - so neither category exempts these supplements.

Q: Does the seller have to collect the tax?
A: Yes. A retailer with a Kansas sales and use tax account must collect Kansas sales tax on these products.

Citations and references

• The Department cited no specific statutory section. Its conclusion is that Kansas taxes retail sales of food and food products and also taxes over-the-counter medicines, so no Kansas exemption applies to herbal fiberblend or barley green supplements, and they are subject to Kansas sales tax. The Department noted other opinion letters reaching the same conclusion about retail sales of herbal supplements.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-2001-040

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

May 9, 2001

XXXX
XXXX
XXXX

RE: Your letter of April 26, 2001

Dear XXXX.

Thank you for your letter. You state that your company has a sales and use tax account with Kansas, and ask if you are required to collect tax on sales of two new products. The products are: (1) herbal fiberblend and (2) barley green supplements. You enclosed copies of the product labels that describe these supplements. Please be advised that the two products are subject to Kansas tax.

States that exempt food sales may exempt many or all of your herbal products, depending on the wording of their exemptions. Unlike these states, Kansas taxes retail sales of food and food products. Similarly, unlike some states, Kansas taxes sales of over-the-counter medicines. Therefore, there are no Kansas exemptions that apply to your products.

I hope that this adequately answers all of your questions. If not, you can call me at (785) 296-3081 or visit our web site at www.ink.org/public/kdor/ . We have written a number of other opinion letters that reach a similar conclusion about retail sales of herbal supplements. This private letter ruling is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to make an accurate determination by the department, this ruling is null and void. This private letter ruling will be revoked in the future by operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or a published revenue ruling, that materially affects this private letter ruling.

Sincerely,

Thomas E. Hatten
Attorney/Policy & Research

Date Composed: 05/15/2001 Date Modified: 10/11/2001

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