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Dec 3, 2007 08:22 PM
Discussion

Eat-In Tax?

Why do fast food places charge an Eat-in tax if you are eating there and not charge tax when you are taking it to-go? And does this only apply to fast food restaurants or all restaurants in general? I have always wondered about this.

TIA!

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  1. I'm not sure what an eat in tax is since I've never seen one, but if it is a tax, the restaurant has no choice but to charge as state and local tax laws require them to.

    1 Reply
    1. re: hannaone

      The important thing to remember is that businesses do not *charge* sales taxes, they *collect* it as an agent of the state.

      Ahhh, memories...when I was growing up, Maryland didn't tax to-go (but taxed eat-in). So we would always order our McDonald's to-go, even though we'd eat at the table. About 30 years ago, the state got wise to us and started charging sales tax on to-go, as well.

    2. Every state and many municipalities have their own sales tax laws (or lack thereof.) In NY, "prepared" foods are taxed, which means anything served in restaurants or even a sandwich in a box on a shelf at the supermarket, but "raw" food, for lack of a better term, is not taxed at all. So the apple and container of milk you buy in a deli here is not taxed at all, but the sandwich you get them to eat with is, at regular sales tax rates. If it were a restaurant, it would all be taxed at the latter. Exactly how the wording works, or whether it's just too big a pain to differentiate and so everyone glosses over it, I don't know, but one would expect to pay tax if the milk and apple were being "taken out" from a diner rather than being bought in a place that's sort of part food preparation/part grocery store even if the milk were an unopened small carton...

      2 Replies
      1. re: MikeG

        Using your explanation, how would you compare ordering a Big Mac to go with a Big Mac to be eaten in? The food prep is basically the same, not?

        1. re: SueofmiamiU

          In Maryland, at least in the 70s, the distinction was between the "restaurant tax" -- which applied to customers who ate their meals on site -- and a lesser or possibly no tax for carryout, because carryout was treated as subject to the same tax as food purchases at grocery stores. (Have not lived in MD in years but recall that , at least in the 70s, there was no tax on food bought at grocery stores in MD).

          I worked at a Gino's in Baltimore during the early 70s and recall clearly that there were always a few cheapskate customers who would state that their order was "to go," and then would eat it there so as to avoid the tax on eating-in.

      2. I'll admit, I'll have the chicken nuggets @ McDonalds, which i love. When I take it to-go, they dont charge a tax. but If eat-in, they will chage a tax. It is actually say "Eat-In Tax" on the receipt.

        1 Reply
        1. re: koshie

          Wow, and I thought taxes on plain food were regressive enough. Plain old food is taxed, but if you can afford to eat in a restaurant, you don't have to pay taxes on the food OR service? Only in America....

        2. we don't have that problem here in Wichita -- we pay taxes on EVERYTHING, even fundraising for non-profits. I'm sure it's just so there's no confusion with any exceptions to the rule, just tax it, tax it, tax it.

          1. its not really an eat in tax. it just says that because it is to let them know that it is for here instead of to go. because i know that mainly it is mcdonald's that has the words eat in tax. but everyone is taxed there.

            but mikeg is right. like here in NC, the prepared foods are one tax rate while other food products are another tax rate. that is for grocery stores.