Retail Sales Tax

Sales taxes are added onto the price of goods or services that are purchased. The merchant is responsible for collecting the sales tax at the point of sale and later remand it to the state. Consumers are charged the tax; resellers are exempt if they do not make use of the goods.

In 1921, West Virginia became the first US state to enact a sales tax . Georgia passed legislation enacting a sales tax in 1929. 11 other states enacted sales taxes in 1933 alone. By 1940, at least 30 states had a sales tax. Currently, 45 of the 50 U.S. States levy a sales and use tax.

Nebraska has a 5.5% state sales tax. Municipalities have the option of imposing an additional sales tax of up to 1.5%.

A retailer must get a Sales Tax Id Number to buy wholesale and sell retail.

Questions

• Do I Need a Seller's Permit, Resale Certificate, or do I just need a Sales Tax ID?

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• Are food and grocery items subject to sales tax?

A: Sales of items that are food and food ingredients are exempt from sales and use tax except when sold through a vending machine, sold by a concessionaire, or as prepared food. Products containing the “Nutrition Facts” box on the product label are exempt. Dietary supplements are not food or food ingredients. Sales of dietary supplements are subject to tax.

• Is selling snack foods such as potato chips over the counter in a restaurant or tavern considered a concession and therefore taxable?

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• Can a restaurant purchase food tax exempt if the tax is added when the food is served to the customer?

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• Are cigarettes taxed at a higher rate than 5.5% state + 1.5% local (7%)?

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• Are alcoholic beverages taxed at a higher rate than 5.5% state + 1.5% local (7%)?

A: Sales of alcoholic beverages are taxable, whether sold packaged as "off-sale," or by-the-drink as "on-sale." Bars, taverns, and restaurants that hold a liquor license are permitted to include the sales tax in the selling price of beverages that are consumed on their premises.

• What does the following statement mean? "Consumer’s use tax is due on the seller’s cost of alcoholic beverages provided free-of-charge."

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• Can a restaurant purchase alcoholic beverages and cigarettes tax exempt if the tax is added at resale?

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• How is Nebraska Pickle Card Lottery taxed?

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