Is Coco Lopez, a coconut-based product used for making tropical drinks and cooking, taxable or exempt as a food product in Texas?

Subject

Coconut Products (Coco Lopez) — Used In Making Tropical Drinks And Cooking

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9312L1274F09

Plain-English Summary

A taxpayer wrote to the Comptroller on December 10, 1993, asking about the taxability of Coco Lopez. The Comptroller's response lists the product's ingredients — coconut, sugar, water, polysorbate 60, sorbitan monostearate, salt, propylene glycol alginate, mono and diglycerides, citric acid, guar gum, and locust bean gum — and notes that the product is used in making tropical drinks (Pina Coladas) and in cooking.

Based on those facts, the Comptroller ruled simply: "Coco Lopez is an exempt food product." The letter states this opinion is based on the facts presented, and that the opinion may change if there are additional or different facts. A note at the bottom indicates this letter references a previous accession number, 9311133L, suggesting it may relate to or update an earlier ruling request.

What This Means For You

If you sell or use Coco Lopez or a comparable coconut-based product (coconut, sugar, water, and similar ingredients) marketed for drink-mixing and cooking use: This letter treats it as an exempt food product rather than a taxable item, based on its ingredient list and its use in beverages and cooking.

If your product differs in ingredients or marketed use: The Comptroller was explicit that this opinion is based on the specific facts presented — the listed ingredients and the stated uses (tropical drinks and cooking). A product with different ingredients, or marketed or used differently, may not fall under the same conclusion.

Note on scope: This letter does not cite any statute or rule explaining why the product qualifies as an exempt food product, and it does not address any other tax question (for example, packaging, other uses, or sales in a different form). It answers only the narrow taxability question the taxpayer asked about this specific product.

Q&A

Q: Is Coco Lopez taxable in Texas?
A: No. The Comptroller ruled that Coco Lopez is an exempt food product.

Q: What ingredients did the Comptroller consider in reaching this conclusion?
A: The letter lists Coco Lopez's ingredients as coconut, sugar, water, polysorbate 60, sorbitan monostearate, salt, propylene glycol alginate, mono and diglycerides, citric acid, guar gum, and locust bean gum.

Q: What is Coco Lopez used for, according to the letter?
A: The letter states the product is used in making tropical drinks (Pina Coladas) and in cooking.

Q: Does this ruling apply to any coconut cream or coconut-based product?
A: The letter doesn't say that. It states the opinion is based on the specific facts presented — this product's particular ingredients and uses — and that the opinion may change if the facts are different.

Original ruling text

December 23, 1993

Dear **:

Thank you for your letter of December 10, 1993, concerning the
taxability of Coco Lopez .

Coco Lopez contains the following ingredients: coconut, sugar,
water, polysorbate 60, sorbitan monostearate, salt, propylene glycol
alginate, mono and diglycerides, citric acid, guar gum and locust
bean gum.

This product is used in making tropical drinks (Pina Coladas)
and in cooking.

Coco Lopez is an exempt food product.

This opinion is based on the facts presented. If there are
additional or different facts, the opinion may change.

You may call toll free 1-800-531-5441, extension 3-4683 if you
have any questions or need more information. You may write to Tax
Administration Division, Comptroller of Public Accounts.

Sincerely,

Eddie C. Washington
Tax Administration Division

NOTE: Previous Accession Number 9311133L