Texas Exempts Food Sales by Religious Groups, Schools, and Non-Profit Organizations

Jul 26th, 2021

Texas recently released guidance on the taxability food sales made by religious groups, schools, and other nonprofit organizations. Generally, these organizations do not have to register for a sales tax permit if they only sell exempt items, or only conduct their sales during tax-free fundraisers.

Churches and religious groups do not have to collect sales tax on meals and food products if the items are sold by churches or at church functions that have been granted exempt status by the Comptroller's office. Youth sports organizations engaged in providing athletic competition for people under 19 years of age can make nontaxable food sales as part of a fundraising drive sponsored by the organization. The sale of meals and food products by public or private elementary or secondary schools, and school support organizations are also nontaxable. The exemption applies to food sales made during the school day, and includes food and beverages sold through school vending machines. It also applies to food sales by a booster club or other school organization during a school-sanctioned or school-sponsored event.