Excise Tax FAQ's

Q.

  What is the use tax?

A.  The use tax is a companion to the sales tax and is imposed upon goods purchased tax-free outside Wyoming, for use in Wyoming.

Q.

  Why is use tax imposed?

A.  The intent of Wyoming's use tax is to restore some fairness for Wyoming's merchants who have to collect the sales tax, whereas out of state merchants may not have to collect sales tax from their Wyoming customers. Use tax levels the playing field between states so our Wyoming merchants are not at a disadvantage.

Q.

  Who must pay use tax?

A.  Any person making tax-free purchases in another state and bringing those goods into Wyoming is subject to the use tax. Licensed Wyoming vendors as well as individual consumers must report their tax-free purchases and remit use tax due.

Q.

  What charges are subject to the Use Tax?

A.  All charges made by the seller to the purchaser are subject to the use tax.

Q.

  Are my catalog purchases subject to the use tax?

A.  Usually. Catalog and other companies not physically located in Wyoming cannot be required to collect sales or use tax on their sales to Wyoming customers. However, some companies want to take the burden off their customers and have voluntarily licensed under the sales tax laws. These voluntary licensees collect the Wyoming sales tax on their sales to Wyoming customers.

Unfortunately not many out of state companies have agreed to collect the sales tax for their customers. In this case the tax reporting burden shifts to the customer.

Q.

  When must I report my tax-free purchases?

A.  The statutes require that purchases, and applicable tax owed, be reported and paid by the end of the month following the month of purchase. For example, purchases made in April must be reported to the Department of Revenue by the end of May.

Q.

  What is the use tax rate?

A.  The use tax rate is the same as the sales tax rate of the county where the purchaser resides.

Q.

  How do I report my use tax?

A.  Businesses licensed under the Wyoming sales tax laws must report use tax on their sales tax return (forms ETS Form 41-1 or 42). Contractors must report their use tax on form ETS-45.

Other non-licensed consumers must report their untaxed purchases and remit the applicable use tax on Consumer Use Tax Form ETS-44. This includes professional service providers such as: accountants, doctors, dentists, consultants, veterinarians, and other liberal professions.

Form ETS-44 is available at all Department of Revenue offices, city and county treasurers' offices, and is stored as a downloadable file on the Department's internet homepage, Forms, Excise Division. The internet address is: http://revenue.state.wy.us

Q.

  Will I be charged penalty and interest if I report late?

A.  Yes. The use tax statutes impose a penalty of 10% (of the tax amount owed) for late reporting. Interest accumulates daily on the unpaid tax.

Q.

  Who is responsible for remitting the 20% on the “other tobacco products?

A.  Wholesaler that purchases the products from the manufacturer.

Q.

  If a Wholesaler purchases cigars from another Wholesaler, who is responsible to pay the 20% excise tax?

A.  The first wholesaler

Q.

  Since we purchase tobacco products excluding cigarettes only about 6 times per month, it would be easier for us to pay the excise tax on the manufacturer’s invoice each month rather than reporting the tax on each individual sale. When is the tax due, at the time of sale to a retailer or at the time we are invoiced by the manufacturer?

A.  When the Wholesaler purchases it from the manufacturer. The excise tax would be paid to this Department on or before the 20th of the month following the month of purchase. For example: The Wholesaler must remit the tax to the Department for their July 1999 purchases by August 20, 1999.

Q.

  If the excise tax is due when we are invoiced by the manufacturer of tobacco products but not all of that invoice is sold in Wyoming, how do we re-coup that 20%?

A.  The reporting form provides for a deduction.

Q.

  If I buy cigarettes and other tobacco products through the internet how does this tax affect me?

A.  Any person who purchases any tobacco product for resale in this state from other than a licensed wholesaler is liable for the tax and any penalties and interest imposed under this paragraph as if he were a wholesaler under this act and shall pay an additional penalty of twenty-five percent (25%) of any tax due. Any wholesaler or other person who fails to file any return or to pay any tax within the time required or permitted by this subsection shall be subject to a penalty of five percent (5%) of the amount of the tax due, plus one percent (1%) of the tax for each month of delinquency or fraction thereof. The department may waive all or any part of this penalty for good cause shown. W.S. 39-18-102 (iv)

The tax imposed by paragraph (iii) of this subsection shall also be imposed upon the use or storage by consumers of cigars, snuff and other tobacco products in this state, and upon those consumers, at the rate of ten percent (10%) of the retail price of the cigar, snuff or other tobacco product.

This tax shall not apply if the tax imposed by paragraph (iii) of this subsection has been paid.

Q.

  Why do we have to pay the excise tax exclusive of any discounts?

A.  W.S. 39-18-101(iv) "Wholesale purchase price" means the established price for which a manufacturer sells the tobacco product to a wholesaler exclusive of any discount or other reduction; W.S 39- 18-102(b) The tax imposed by W.S. 39-18-103(a)(iii) shall be paid by the wholesaler. The wholesaler shall be entitled to retain four percent (4%) of any tax collected under W.S. 39-18-103(a)(iii).39-18-103. Imposition.

Q.

  If I buy cigars from a company in Colorado who is not a wholesaler in Wyoming, as a Wyoming vendor am I responsible for the 20% excise tax. Would I be considered a Wholesaler and be required to have a Wholesaler license?

A.  The cigarettes must have Wyoming stamps on them per W.S. 39-18-108(i) Any package of cigarettes found in this state without stamps, imprints or impressions affixed thereto as provided by this article is contraband goods and may be seized without a warrant by the department, with board approval, or any peace officer of this state when so directed by the department. This section does not apply to cigarettes in the original unopened shipping package in the possession of or in transit to a licensed wholesaler or to owners of cigarettes not willfully or intentionally evading the tax imposed by this article; (vi) Any person who purchases any tobacco product for resale in this state from other than a licensed wholesaler is liable for the tax and any penalties and interest imposed under this paragraph as if he were a wholesaler under this act and shall pay an additional penalty of twenty-five percent (25%) of any tax due. Any wholesaler or other person who fails to file any return or to pay any tax within the time required or permitted by this subsection shall be subject to a penalty of five percent (5%) of the amount of the tax due, plus one percent (1%) of the tax for each month of delinquency or fraction thereof. The department may waive all or any part of this penalty for good cause shown. W.S. 39-18-102 (iv)

The tax imposed by paragraph (iii) of this subsection shall also be imposed upon the use or storage by consumers of cigars, snuff and other tobacco products in this state, and upon those consumers, at the rate of ten percent (10%) of the retail price of the cigar, snuff or other tobacco product.

 This tax shall not apply if the tax imposed by paragraph (iii) of this subsection has been paid.

 

Q.

  Is there a minimum or maximum price for tobacco products charge required in Wyoming?

A.  No, Wyoming law does not have a specific statute to impose a minimum or maximum retail selling price for cigarettes or other tobacco products.

Sales Tax on Food Exemption

Q.

  Is food sold in restaurants taxable?

A.  Yes. Food sold in restaurants is prepared food, typically sold with utensils and is designed for immediate consumption.

Q.

  Are soft drinks exempt as food?

A.  Yes, unless they are sold in a cup provided by the seller. The soft drink is then considered prepared food to be sold for immediate consumption.

Q.

  Is takeout food, food sold at a drive-through, or delivery food exempt?

A.  No. In these cases, the food is considered prepared food and is taxable.

Q.

  Is food at the movie theatre or sporting events such as UW sporting events taxable?

A.  Yes. Typically food sold by concessionaires is intended for immediate consumption.

Q.

  Are cough drops considered food?

A.  No. They are not consumed for taste or nutrition. They are a medicine designed to treat a condition. This answer applies to all over-the-counter medications and remedies.

Q.

  Are alcoholic beverages taxable?

A.  Yes. These products are excluded from the definition of food.

Q.

  Are gift sets that bundle non-food items and food items taxable? For example, is a gift set containing a stuffed toy and candy taxable?

A.  If the majority of the purchase or sales price is comprised of exempt food items, then the bundle takes on the character of the exempt items. If the majority of the purchase or sales price is comprised of taxable items such as toys, then the bundle takes on the character of the taxable items.

Q.

  How does this law affect Farmer’s Markets?

A.  The bulk of food sold at a farmer’s market is clearly intended to be taken home for later consumption and exempt from sales tax. But some food concessionaires sell food for immediate consumption; e.g. prepared hot foods, soft drinks sold in a cup, ice cream or sno-cones, etc. These are 'prepared foods' and subject to Wyoming sales tax.

Q.

  Is ice taxable?

A.  Crushed or cubed ice is considered food for domestic home consumption, and will be sales tax exempt. Block or dry ice is used for cooling, not consumption, and remains subject to sales tax.

Q.

  Is non-alcoholic beer taxable?

A.  Non-alcoholic beer typically contains less than 0.5% alcohol, and is exempt from sales tax. Alcoholic beverages containing 0.5% or more of alcohol will remain subject to sales tax.

Q.

  Are breath mints and chewing gum taxable?

A.  Breath mints and chewing gum are exempt as candy, or at a concessionaire.

Q.

  Are breath strips or breath sprays taxable?

A.  Breath strips and breath sprays remain subject to sales tax, as they are commonly used for a hygienic purpose – to kill germs, freshen breath, etc. These items are not consumed merely for taste or nutrition.

Q.

  Is pet food exempt?

A.  Pet food is not designed "...for ingestion or chewing by humans." and does not meet the definition of exempt food. Pet food remains subject to sales tax.

Q.

  The exemption only applies to the four percent (4%) state rate, right?

A.  Wrong. The language of the exempts qualifying food from all sales/use taxes - both the state rate, and all local option taxes, if applicable in your county.

Q.

  Is meat processing taxable?

A.  It depends on what is actually occurring. If the meat processor buys a carcass, processes it into freezer-ready packaged meats, and sells the meat packages at retail then the meat processor is selling qualifying exempt food.

If the meat processor is processing someone else's carcass, then the meat processor is not selling food. A vendor cannot sell a product to which it never had title. In this instance, the meat processor is selling a service to convert the carcass into ready-wrapped meats. This service remains subject to sales tax.

Q.

  I own a bar, and most of the food I sell is prepared food. However, sometimes I sell a single bag of chips - how do I handle this small percentage of sales which is consumed at the bar?

A.  If more than 75% of a food vendor's sales are comprised of food that is heated by the seller or foods where the seller combined two or more ingredients to make a single item, then all of the vendor's sales of single serve items are taxable.

Q.

  Are non-alcoholic beverages such as non-alcoholic beers and wines exempt?

A.  If the beverages contain less than ½ % of alcohol by volume then they are not considered an alcoholic beverage and are considered food and thus tax exempt.

Q.

  Are bakery products exempt?

A.  Generally yes, unless the bakery good is sold with utensils or is combined with other food products by the seller. An example of this would be a bagel and cream cheese or a sandwich. These would then become prepared foods and taxable. However a loaf of bread or a bag of bagels or donuts made in a bakery would be exempt.

Q.

  Are foods sold in a deli section of the grocery store exempt?

A.  Generally yes, with the notable exception of heated foods and foods sold with utensils provided by the seller. Deli meats, sliced and packaged by the seller and sold by weight are exempt as are deli salads sold by weight. Heated deli chicken and other products heated by the seller are taxable. A salad sold in a package with a fork and dressing would be taxable as prepared food.

Q.

  Are products which require preparation by the seller but which will require additional preparation by the consumer exempt from the tax?

A.  Yes. A good example of this would be a fresh pizza offered for sale by a vendor. A notable example of this is a take and bake pizzeria. The pizza is prepared by the vendor however is sold without being cooked. The pizza must be cooked by the purchaser.

Q.

  Is cooking sherry or cooking wine taxable?

A.  Liquids used in cooking that exceed the alcohol content of 0.5% but are not intended for sale as a beverage (drinkable liquid), are sales tax exempt food and food ingredients.

Q.

  Are flavored extracts, such as vanilla extract, taxable?

A.  Liquids used in cooking that exceed the alcohol content of 0.5% but are not intended for sale as a beverage (drinkable liquid), are sales tax exempt food and food ingredients.
Q.

  Are wedding cakes taxable?

A.  Wedding cakes picked up from a grocer or bakery are not subject to sales tax unless the vendor also provides utensils such as plates, forks or serving utensils as part of the price for the wedding cake. Wedding cakes sold and served by a caterer are taxable as prepared foods.

Q.

  Is a 5-gallon bottle of water subject to sales tax?

A.  A 5-gallon bottle of water is not subject to sales tax.

Q.

  Are novelty candies, such as Pez dispensers, considered exempt candy?

A.  No. If the value of the toy exceeds 50% of the price of the item, then the candy/toy combination would be subject to sales tax. However, candy refills would be exempt food.

Q.

  Are party trays containing cold products like cheese, sliced meats, fruits or vegetables taxable?

A.  Party trays made by an entity whose primary NAICS code is that of a food manufacturer are exempt as food for domestic home consumption. Party trays assembled by a deli, grocery store, or any entity other than a NAICS-classified food manufacturer are taxable as prepared food.

Q.

  If I own a hotel/restaurant, and have a long-term guest, is what s/he buys subject to sales tax?

A.  The guest’s status as a short-term or a long-term guest is not the determining factor. Anything purchased from the restaurant or room service that is hot or comes with utensils is subject to sales tax.

Q.

  I have a lumber store that has a 20-foot long rack of single serve packages of chips, nuts, candy bars, etc. Are these taxable?

A.  Single serve packages of snacks are exempt food regardless if they are sold at a lumber store, an office supply store, a convenience store or a grocery store. Such items transition to taxable if they are sold at a concessionaire, as part of a meal deal, or with utensils

Q.

  My grocery store offers a salad bar service - there are various ingredients which I combine into a salad, and the grocery store charges me based on the weight of my completed salad. Is this exempt food?

A.  Yes, so long as there are no hot ingredients added to the salad, and the seller does not hand you a fork or other utensils.