The tax man cometh — and he’s thirsty
Category: Tennessee Department of Revenue, drink prices, drink menu, Alcoholic Beverage Regulations
03.30.18
Lots of folks have been asking of late, “Do I have to show taxes in drink prices?”
The Tennessee Department of Revenue recently clarified that including taxes in drink prices is optional. Previously, the state required that menu prices include both liquor by the drink and sales taxes.
The law now gives taxpayers the option to include taxes on the final bill to the customer, instead of in the sales price listed in menus.
A copy of the notice from Revenue is included here. LBD Tax Notice.pdf
Please keep in mind that price schedules should still contain all taxes, including both liquor by the drink and sales taxes.
If menu prices do not include taxes, Revenue advises that the menu must state that the “15% LBD tax and sales taxes will be included on the final bill.”
See our blog post concerning price schedules here.
The notice clears up a long-standing dispute we have had with Revenue over taxes. We have always thought that Revenue lacks statutory authority to require that taxes be included in drink prices on menus.
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