Sales tax must always be separately stated on the sales receipt that is given to the customer. However, there are instances when the sales tax may be included in the advertised price.
A business may advertise and/or sell meals, beverages, or other items at prices including sales tax but only if the menu and other price information clearly indicate that sales tax is included in the price.
Calculating the taxable amount: If sales tax is included in the price, the amount of tax may be backed out of “gross receipts” to arrive at the amount subject to tax.
Example: A glass of wine is sold for $5, including sales tax. Assuming an 8.4 percent tax rate, the gross amount subject to tax is $4.61 (5/1.084).
Example: A coffee bar sells a double, tall, latte for $3, including sales tax. Assuming a tax rate of 8.4 percent, the taxable amount is $2.77 (3/1.084).
Note: If sales tax is not separately stated or properly indicated as included, it is presumed that retail sales tax was not collected. In which case, retail sales tax applies to the gross receipts of the business.
What about vending machine sales?
It is not necessary to separately state the amount of sales tax or to post “tax included” when making sales through a vending machine. See the Vending Machines Section.