Determine if the activity on the premises qualifies the operator to be a "restaurant." A restaurant is defined by RSA 78-A:3 X (b) as:
"Restaurant" means an eating establishment where food, food products, or beverages including alcoholic beverages are served and for which a charge is made. The term includes, but is not limited to, a cafe, lunch counter, private or social clubs, diner, snack bar, dining room, food vending machine, and any other eating place or establishment where meals are served, even if the service of a meal is not the primary function of the establishment such as but not limited to convenience stores, gas stations, or supermarkets, but only as to the portion of such establishment that serves a "meal" as defined in this chapter. The term includes eating establishments whether stationary or mobile, temporary or permanent. (Emphasis added.)
The portion of any convenience store or grocery store that offers a taxable meal is, according to law, classified as a restaurant. A "meal" is defined by law and regulation as follows:
RSA 78-A:3 Definitions.
X. The following terms have the meaning as stated:
(a) "Meal" means any food or beverage, or both, prepared for human consumption and served by a restaurant, whether the food or beverage is served for consumption on or off the restaurant premises. The term "meal" includes food or beverages sold on a "take out" or "to go" basis, whether or not they are packaged or wrapped and whether or not they are taken from the premises of the restaurant. The term "meal" excludes any food or beverage wholly packaged off the premises except: (1) sandwiches of all kinds; (2) beverages in unsealed containers; and (3) catered meals or meals which are delivered to the location where the meal is consumed. Beverage includes an alcoholic beverage, served with or without food.
Rev 701.13 "Meal," as defined under RSA 78-A:3 X (a):
(a) Includes any food or food products, such as but not limited to:
- (1) Sandwiches of any kind whether prepared or packages on or off the premises;
- (2) Beverages in unsealed containers including any alcoholic, malt, or vinous beverage;
- (3) Salads from salad bars ;
- (4) Heated food including meats, soups, stews or chowders;
- (5) Party platters such as vegetable, meat, dessert, bakery fruit, hors d'oeuvres; or
- (6) Prepared, ready to eat products whether or not such products have been warmed or cooled to a preferred temperature. (Emphasis added.)
(b) Does not include:
- (1) Food or food products, wholly packaged off the premises of the operator and sold in their original unopened container , including but not limited to, items such as:
- a. Potato chips;
- b. Corn chips;
- c. Crackers and cheese;
- d. Pastries;
- e. Candy;
- f. Gum;
- g. Breath mints;
- h. Cough drops; or
- i. Antacid lozenges; and
- 2) Canned, bottled or packaged ready-to-drink beverages that are wholly packaged off the premises of the operator and sold in their original unopened container, including but not limited to, such items as soda pop or fruit drinks; and
- (3) Pre-packaged ready-to-eat refrigerated or frozen desserts or novelties, that are wholly packaged off the premises of the operator and are sold in their original container, including but not limited to, items such as ice cream or frozen yogurt in cups, cones, or sticks. [emphasis added.]
Determine what products, in addition to those listed above, are taxable.
If a portion of the store is selling a taxable meal, such as one or more of the products listed above, then that portion of the store is defined as a "restaurant." Once a portion of the store meets the definition of a "restaurant," then other prepared food products sold in the same portion of the store will become subject to the tax. The items listed below are a sample of the types of products that would become taxable when they are sold by a restaurant or the "restaurant" portion of a store. If the products listed below are available in a NON-RESTAURANT section of the store, then they would NOT be subject to the Meals and Rentals tax. If the products listed below are available from a "RESTAURANT" section of the store and the total taxable sale is 36 cents or more, then they ARE taxable:
1. Single serving bakery type products which are packaged on the premises by the store or the customer and sold in individual servings, such as but not limited to; donuts, cookies, brownies, slices of pie, slices of cheesecake, croissants, pieces of cake, pieces of a torte, pudding, Jell-O type gelatin, rolls, bagels, and muffins.
When sold heated, these products are ALWAYS taxable. When sold at a store, unheated bakery type products sold in a quantity of six or more are NOT TAXABLE.
Items 2, 3, and 4 as they appeared in the original guideline letter dated 10/5/92 have become obsolete due to the addition of Rev 701.13 (a) (6) as quoted above. All foods which are prepared and ready to eat, whether hot or cold , are subject to tax.
Maintain documentation necessary to differentiate between the sale of taxable and non-taxable items.
Department of Revenue personnel are available to walk through your premises to help you identify taxable and non-taxable products and to answer any questions you may have. please be advised that any change in your operation may change the classification of your products.
Please Note: The following facts DO NOT affect the classification of a product as taxable or nontaxable: whether or not seating facilities are available, if the items are served "to go" or are intended for on-premise consumption, if an item is sold with or without a beverage, and the method or location of payment.
This guideline was revised July 15, 1999 by the New Hampshire Department of Revenue Administration and is based on the laws and regulations in effect July 15, 1999. Any change in the laws or the regulations may render this guideline obsolete. If you have any questions, please call the New Hampshire Department of Revenue Administration, Audit Division, at (603) 230-5030.