NEWS RELEASE FOR IMMEDIATE RELEASE June 1, 2001 DC Ends the Snack Tax! WASHINGTON, DC - Snack food lovers have a great reason to celebrate! No more tax on snacks in the District! A new law goes into effect on June 9, that eliminates the 5.75% sales tax on snack food items in the District of Columbia. "Repealing the snack food tax is a business-friendly and consumer-friendly change that satisfies everyone," said Herbert J. Huff, Deputy Chief Financial Officer for Tax and Revenue. "We are simplifying our sales tax accounting procedures while providing a means to lower prices for retail customers." The Tax Clarity Act of 2000 repealed the sales tax on individual snack food items by adopting the federal definition of food eligible for food stamps to determine what is non-taxable. Generally, any grocery food not intended for immediate consumption is not taxed, under the federal definition. Snack foods had been the exception in the District since the tax was imposed in 1993. The repeal of the snack food tax could mean lower prices for favorite munchies like potato chips, pretzels, packaged popcorn, canned and bottled juice and soda, candy bars and bubble gum. It also ends years of confusion among consumers and retailers. Before the change in the law, a consumer buying a package of candy bars in the District would pay no sales tax. But if that same consumer bought a single candy bar, he would pay a 5.75% sales tax. With the new law, there is no sales tax on either snack food item. In eliminating the snack tax, the District joins the rest of the nation in being snack food tax-free. The state of Maine repealed its snack food tax last year, according to the Alexandria-based Snack Food Association. The following items cannot be purchased with food stamps, and therefore are still taxable under District law: Alcoholic beverages and tobacco Hot foods that are ready to eat Any food marketed to be heated in the store Lunch counter items or food to be eaten in the store (this would include freshly popped popcorn in a movie theater, for instance) Fountain dispensed and self-serve beverages Pet foods Any non-food items