11/01/2005
A restaurant patron recently emailed the Bureau asking if we could explain the "liquor tax" on her dinner check. She hadn't been charged tax on liquor purchased at the restaurant's bar and wondered just what the rules for charging the tax are.
We began our investigation by calling the restaurant and asking for an explanation. The customer, in the meantime, contacted the State Board of Equalization. Both restaurant and Board gave much the same explanation:
The liquor tax, it seems, is not a new tax. It's the same sales tax, at the same rate, that is charged on the meal. The computer just breaks the amounts down and assigns a different name to the amount charged for liquor served at the table.
Why don't you pay the tax at the bar? You do. But because busy bartenders don't want to take time to make change, the tax is included in a round figure charged for the drink.
Since a drink may cost, then, say $5.00 at the bar or $5.00 on your meal check, but with tax added if ordered from the table, this savvy customer suggests ordering drinks at the bar, carrying them to the table and saving the difference.
|