Candy Tax – Not a Sweet Endeavor
After taxing the tar out of tobacco, liquor, and gas products and other items from the “sin” sector, several states have made the move to take a bite out of your wallet with a candy tax. Yes, that’s right, your penchant for a Twizzlers suddenly will affect the size of your waistline AND your bank account in states like Illinois. Or will it? Like most laws, the candy tax is more complicated than you’d think.
In Illinois, needing some way to quantify the term “candy,” lawmakers proposed than anything made with flour is to be considered a food and NOT candy. I’m sure you have noticed over the years that the tax on a grocery bill is often negligible when compared to the total amount spent thanks to the amount of “food” items purchased, which are taxed at a level much lower than the standard tax rate in many counties. Now, if you are subject to the so-called candy tax, you will see many different tax rates on the products you buy.
Here’s the crazy part: with the “flour equals food” equation, Twizzlers will be food (low tax), but a Snickers bar will be candy (high tax). Each state has tax laws crazier than the next, and while this Illinois law ranks up there, a Chicago Tribune article talks about some interesting attempts by other states to do things such as taxing pumpkins at different rates depending on their intended use! Apparently Iowa lawmakers thought that jack-o-lanterns should bring more tax dollars to the state than pumpkin pie. I guess a few extra pennies for yogurt-covered raisins doesn’t seem so bad.
Read on:
ChicagoTribune.com – Candy or food? Confusion grows as new tax looms
BostonHerald.com – Patrick sweet on candy, soda, booze tax
CSDecisions.com – Confusing Tax Redefines Candy
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