What is considered a “bakery item?”

“Bakery items” include breads, rolls, bagels, biscuits, croissants, pretzels, donuts, pastries, pies, cakes, tortes, muffins, cookies, tortillas, etc.

Note: Candy and pizza are not considered bakery items for purposes of the tax exemption.

Are bakery items taxable?

Washington law specifically exempts sales of bakery items, but only when the bakery item(s) are sold without eating utensils provided by the seller.

Should retail sales tax be collected when bakery items are sold with coffee?

You must collect retail sales tax on the sale of the coffee. However, you may sell the bakery items tax exempt if: 1) you properly segregate taxable and nontaxable sales, and 2) you do not sell the bakery item with a utensil (plate, fork, napkin, etc.).

A seller is considered to be selling the bakery items with utensils if the seller physically includes a utensil with the bakery item. For example, serving the bakery item on a plate or placing a napkin in a bag with the bakery item.

Merely making utensils available for the customer to take at the customer’s discretion does not constitute “selling with eating utensils.” For example, bakery items are not “sold with eating utensils” when the seller has merely placed a napkin dispenser on the counter or has set up a utensil “island” for customers.

References: RCW 82.08.0293; WAC 458-20-124; WAC 458-20-244; WAC 458-20-119 and WAC 458-20-12401