State of Rhode Island - Division of Taxation
Sales and Use Tax
Regulation SU 87-123
Food Stamp Purchases
When an individual purchases eligible food items in an order containing both taxable and nontaxable food items and presents both cash and food stamps for the order, the retailer shall apply the food stamps first to the taxable portion of the transaction.
EXAMPLE: A food stamp recipient arrives at the check-out with a $25 order consisting entirely of eligible food items. However, eleven ($11) dollars' worth of the food is taxable under state law (i.e., soda, gum, candy) and the remainder is not taxable. The recipient pays for the order with five dollars ($5) in food stamps and twenty dollars ($20) in cash.
The five dollars ($5) in food stamps must first be applied to the eleven ($11) dollars' worth of taxable items, resulting in a tax being charged for the six ($6) dollars' worth of taxable items not purchased with food stamps.
R. GARY CLARK
DATE: DECEMBER 1, 1987
THIS REGULATION REPLACES THE EMERGENCY RULE EFFECTIVE OCTOBER 1, 1987.