Arkansas Food Tax Law

By Joseph Scrofano J.D./M.A.
Arkansas has a separate sales tax for groceries.

grocery store image by robert mobley from Fotolia.com

Arkansas assesses a general sales tax on all transactions for the sale of tangible personal property. However, food sales do not fall within the general sales tax. Arkansas has a lower food tax that is separate from the general sales tax.

Applicability

The food tax only applies to unprepared foods. That means groceries typically fall within the food tax rate. On the other hand, fast food and other restaurant foods fall within the general sales tax.

DFA

The Arkansas Department of Finance and Administration (DFA) is a state government agency that enforces Arkansas tax laws, which include the food tax. Arkansas businesses that sell food, typically grocery stores must collect the taxes and file and pay the food tax to the DFA.

Rate

The food tax rate in Arkansas is lower than the general sales tax. As of 2010, the food tax rate is 2 percent. The state general sales tax, however, is 6 percent.

Local Taxes

In addition to state sales and food taxes, local counties and cities in Arkansas can impose additional taxes to unprepared food transactions. For example, if you live in Little Rock, you would pay a total of 3.5 percent in food taxes. The state imposes a 2 percent food tax plus Pulaski County imposes a one percent tax and the city of Little Rock imposes a .5 percent tax for a total of 3.5 percent.

Changes

The Arkansas state government lowered the food tax rate from 3 percent to 2 percent on Jan. 1, 2009. Accordingly, the Arkansas food tax rate remains subject to change based on any future change in Arkansas law.

Resources

About the Author

An attorney and founder of ScrofanoLaw, a general practice law firm in Washington, D.C., Joseph Scrofano has been writing on legal issues since 2008. He holds a Juris Doctor from the Washington College of Law, a Bachelor of Arts with special honors from the University of Texas and a master's degree in international affairs from American University's School of International Service.