Rhode Island Code of Regulations › Title 280 - Department of Revenue › Chapter 20 - Division of Taxation › Subchapter 70 - Sales and Use Tax › Part 4 - Local Meals and Beverage Tax (280-RICR-20-70-4) › Section 280-RICR-20-70-4.8 - Convenience and Food Stores, Delicatessens, and Bakery/Cafes

Current through June 14, 2024
A. There are two criteria that must be met
				 for a sale to be subject to the one percent (1%) local meals and beverage tax.
				 The first criterion is whether or not the item sold is a meal and/or beverage
				 as defined by §
										4.5     of this Part. The second
				 criterion is whether the meal and/or beverage is sold by an eating and/or
				 drinking establishment as provided by §
										4.5     of this Part.
B. As a general rule, eating and/or drinking
				 establishments do not include food stores and supermarkets. However, the law
				 defines eating and/or drinking establishments as restaurants, bars, taverns,
				 lounges, cafeterias, lunch counters and other like places of business which
				 furnish or provide facilities for immediate consumption of food at tables,
				 chairs or counters or from trays, plates, cups or other tableware provided
				 primarily for the use of patrons in consuming products purchased at the
				 location. Since the activities of some food stores and supermarkets fall within
				 this definition, such stores or a certain area of the stores would qualify as
				 eating and/or drinking establishment when selling prepared food and/or
				 beverages. Therefore, such sales would be subject to the one percent (1%) local
				 meals and beverage tax on those receipts.
C. In the event that a food/delicatessen
				 store or bakery/café provides facilities for immediate consumption of
				 prepared food at tables, chairs, or counters in a general area, the entire
				 store is considered an eating and/or drinking establishment and the one percent
				 (1%) local meals and beverage tax, as well as the seven percent (7%) state
				 sales tax applies to food catering sales as well as all prepared food and/or
				 beverages purchased throughout the store, whether consumed on the premises or
				 not.
D. If the same facts stated
				 above exist and a separate register is maintained in a specific area to record
				 sales of prepared and catered food from this area only, this area is considered
				 an eating and/or drinking establishment and any prepared food and/or beverages
				 sold from the other areas would not be subject to the one percent (1%) local
				 meals and beverage tax.
E.
				 Examples:
1. Example 1: A convenience or food
				 store provides facilities for immediate consumption of prepared food and/or
				 beverages at tables, chairs, or counters in a general area of the store.
				 However, there is no separate cash register to ring up the prepared food nor
				 are their employee(s) attending to customers in the area where the tables are
				 located. Customers may purchase prepared food and/or beverages from anywhere in
				 the store and use the tables, chairs, or counter to consume the items. In this
				 example, the store is considered an eating and/or drinking establishment and
				 the one percent (1%) local meals and beverage tax applies to all prepared food
				 and/or beverages purchased throughout the store, whether consumed on the
				 premises or not.
2. Example 2: A
				 convenience or food store provides facilities for immediate consumption of
				 prepared food and/or beverages at tables, chairs, or counters in a specific
				 area of the store. The prepared food and/or beverages are purchased by
				 customers from employee(s) or at a cash register in that specific area only.
				 The specific area is considered an eating or drinking establishment and all
				 sales of prepared food and/or beverages from that specific area only are
				 subject to the one percent (1%) local meals and beverage tax., whether consumed
				 on the premises or not. Prepared food and/or beverages sold from the grocery
				 section of the store are not subject to the one percent (1%) local meals and
				 beverage tax.
3. Example 3: A
				 convenience or food store sells prepared food but does not provide facilities
				 for immediate consumption (tables, chairs or counters); the store is not an
				 "eating and/or drinking establishment; therefore, the one percent (1%) local
				 meals and beverage tax does not apply.