Is 'tomato pie' — a cold, bread-dough-and-tomato baked good sold by the slice at an Italian deli — exempt from New York sales tax as a bakery item?

Plain-English summary

An Italian deli in Utica, New York sells a locally known specialty called "tomato pie" — bread dough baked with tomatoes in a bread oven. The New York State Department of Agriculture & Markets doesn't require it to be kept at a "holding temperature" the way hot prepared foods must be, because it's meant to be eaten cold or at room temperature. The deli sells slices wrapped in paper and packaged in a bag (single slices) or box (multiple slices) for customers to take home; there's no seating or on-premises eating.

New York generally taxes food sold by restaurants and similar establishments, but carves out an exception for food sold off-premises, unheated, in the same form and packaging you'd find at an ordinary grocery-type food store rather than an establishment principally selling ready-to-eat prepared meals. The Department found the deli's tomato pie fits squarely within that carve-out: it's genuinely cold (not merely lukewarm or reheated), sold for take-home consumption with no eat-in option, and packaged the way a bakery or grocery would package cold baked goods — bag for a single slice, box for multiple. That makes it exempt as a baked good sold for human consumption under New York's general food exemption, just like buying a loaf of bread or a dozen cookies from a bakery.

What this means for you

Delis, bakeries, and specialty food retailers selling regional cold-baked specialties

The taxability line isn't about how unusual or locally specific your product's name or recipe is — it's about the same three factors New York always applies: is it sold unheated, is it for off-premises consumption (no seating/eat-in), and is it packaged and sold the way an ordinary grocery/bakery sells that type of item rather than the way a restaurant plates a ready-to-eat meal. Meeting all three keeps a baked good exempt even if it has an unusual local name like "tomato pie."

Businesses selling the same product both hot and cold

This ruling addresses only a cold, room-temperature product with no eat-in option. A business that also sells a hot, ready-to-eat version of a similar product, or that provides seating for immediate consumption, would need its own separate analysis for that version — the exemption doesn't follow the product name, it follows the specific facts of temperature, packaging, and consumption location.

Sellers unsure whether "sold by the slice" changes the analysis

Selling a baked item by the slice doesn't disqualify it from the food-store exemption on its own — what matters is that it's still sold unheated and packaged the way a bakery/food store would package it (bagged or boxed for takeout), not arranged on a plate as a ready-to-eat meal.

Common questions

Q: Does selling a baked good "by the slice" make it taxable like a restaurant meal?
A: Not by itself — as long as the slice is unheated, sold for off-premises consumption, and bagged/boxed the way a bakery or food store would package it (rather than plated as a ready-to-eat serving), it stays exempt as a baked good.

Q: Would this tomato pie be taxable if the deli served it warm or provided seating?
A: Very likely yes for at least those sales — the exemption here specifically rests on the product being genuinely cold/room-temperature with no on-premises eating option; selling it heated or providing seating for immediate consumption would trigger the restaurant-style tax instead.

Q: Does the state's food-safety classification (not requiring a "holding temperature") determine the sales tax outcome?
A: It's supporting evidence that the product is genuinely meant to be eaten cold, but the sales tax analysis itself turns on the Tax Law's own unheated/off-premises/food-store-packaging test, not directly on the food-safety classification.

Citations and references

Statutes and rules:

• Tax Law § 1105(a) (retail sales tax)
• Tax Law § 1105(d)(i) (restaurant/caterer food and drink tax)
• Tax Law § 1115(a)(1) (food/beverage exemption)
• 20 NYCRR 527.8(a), (e) (restaurant tax imposition; consumption-off-premises and food-store rules, including the pound-vs.-serving distinction)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2004.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a04_28s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Tax Policy Analysis
Technical Services Division

TSB-A-04(28)S
Sales Tax
December 14, 2004

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S040323A

On March 23, 2004, the Department of Taxation and Finance received a Petition for
Advisory Opinion from Michael A. Tomaselli, Italian Salumeria Deli, 421-423 James St., Utica,
NY 13501. Petitioner, Michael A. Tomaselli, Italian Salumeria Deli, furnished additional
information with respect to the Petition on April 6, 2004.
The issue raised by Petitioner is whether the sale of a food product locally marketed as
tomato pie is subject to sales tax.
Petitioner submitted the following facts as the basis for this Advisory Opinion.
Petitioner sells a product locally known as tomato pie. Petitioner describes a tomato pie
as a food product baked in a bread oven with bread dough and tomatoes. Tomato pie is a product
which the New York State Department of Agriculture & Markets deems not necessary to be kept
or served at a “holding temperature.” Tomato pies are intended to be consumed cold or at room
temperature. Petitioner does not make sales for on premises consumption. Petitioner may sell
tomato pies by the slice. The tomato pie slices are wrapped in paper and are then packaged in a
bag or box for off premises consumption.
Applicable law and regulations
Section 1105(a) of the Tax Law provides, in part:
On and after June first, nineteen hundred seventy-one, there is hereby imposed and there
shall be paid a tax. . . .upon:
(a) The receipts from every retail sale of tangible personal property, except as otherwise
provided in this article.
Section 1105(d)(i) of the Tax Law provides for the imposition of sales tax, in part, on:
The receipts from every sale of beer, wine or other alcoholic beverages or
any other drink of any nature, or from every sale of food and drink of any nature
or of food alone, when sold in or by restaurants, taverns or other establishments in
this state, or by caterers, including in the amount of such receipts any cover,
minimum, entertainment or other charge made to patrons or customers (except
those receipts taxed pursuant to subdivision (f) of this section):

2

TSB-A-04(28)S
Sales Tax
December 14, 2004

(1) in all instances where the sale is for consumption on the premises
where sold;
(2) in those instances where the vendor or any person whose services are
arranged for by the vendor, after the delivery of the food or drink by or on behalf
of the vendor for consumption off the premises of the vendor, serves or assists in
serving, cooks, heats or provides other services with respect to the food or drink;
and
(3) in those instances where the sale is made through a vending machine
that is activated by use of coin, currency, credit card or debit card (except the sale
of drinks in a heated state made through such a vending machine) or is for
consumption off the premises of the vendor, except where food (other than
sandwiches) or drink or both are (A) sold in an unheated state and, (B) are of a
type commonly sold for consumption off the premises and in the same form and
condition, quantities and packaging, in establishments which are food stores other
than those principally engaged in selling foods prepared and ready to be eaten.
Section 1115(a) of the Tax Law provides, in part:
Receipts from the following shall be exempt from the tax on retail sales
imposed under subdivision (a) of section eleven hundred five and the
compensating use tax imposed under section eleven hundred ten:
(1) Food, food products, beverages, dietary foods and health supplements,
sold for human consumption but not including (i) candy and confectionery, (ii)
fruit drinks which contain less than seventy percent of natural fruit juice, (iii) soft
drinks, sodas and beverages such as are ordinarily dispensed at soda fountains or
in connection therewith (other than coffee, tea and cocoa) and (iv) beer, wine or
other alcoholic beverages, all of which shall be subject to the retail sales and
compensating use taxes, whether or not the item is sold in liquid form. The food
and drink excluded from the exemption provided by this paragraph under
subparagraphs (i), (ii) and (iii) of this paragraph shall be exempt under this
paragraph when sold for seventy-five cents or less through any vending machine
activated by the use of coin, currency, credit card or debit card. With the
exception of the provision in this paragraph providing for an exemption for
certain food or drink sold for seventy-five cents or less through vending
machines, nothing herein shall be construed as exempting food or drink from the
tax imposed under subdivision (d) of section eleven hundred five.
Section 527.8 of the Sales and Use Tax Regulations provides, in part:
(a) Imposition. Sales tax is imposed on the receipts, including any cover,
minimum, entertainment or other charge, from every sale of beer, wine or other

TSB-A-04(28)S
Sales Tax
December 14, 2004

3

alcoholic beverages and food or drink of any nature sold in or by restaurants,
taverns or other establishments in this State or by caterers:
(1) in all instances where the sale is for consumption on the premises
where sold;
(2) in those instances where the sale is for consumption off the premises
and the vendor (or someone acting on behalf of the vendor) after delivery either
serves or assists in serving, cooks, heats or provides services with respect to the
food or drink; and
(3) in those instances where the sale is for consumption off the premises of
the vendor all sandwiches and other food or drink unless the food or drink is sold
in:
(i) an unheated state; and
(ii) the same form and condition, quantities and packaging commonly used
by food stores not principally engaged in selling foods prepared and ready to be
eaten.
*

*

*

(e) Consumption off premises. The phrase for consumption off the
premises shall mean that the food, including sandwiches, or drink is intended to
be consumed at a place away from the vendor's premises.
(1) Food or drink in a heated or unheated state. The determination of
when food or drink is sold either in a heated or unheated state must be made
according to the vendor's method of merchandising.
(i) If the vendor attempts to maintain the food at a temperature which is
warmer than the surrounding air temperature by using heating lamps, warming
trays, ovens or similar units, or cooks to order, the vendor is selling food in a
heated state.
(ii) If the vendor sells prepared foods from units maintained at or below
surrounding air temperature, such sales are sales of prepared food in an unheated
state.
*

*

*

(2) Form, condition, quantity and packaging sold in food stores.

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Sales Tax
December 14, 2004

(i) The term food stores shall mean any establishment which is principally
engaged in selling food or drink which is not prepared and ready to be eaten.
Supermarkets, grocery stores, fish markets, produce markets, bakeries and meat
markets are examples of the types of establishments considered to be food stores.
When a department within food stores makes sales of food or drink which are
subject to tax, it must collect the tax.
(ii) Food sold in an unheated state is taxable when sold as sandwiches or
meals ready to be eaten when arranged on plates or platters as individual or
multiple servings regardless of how the sales price is arrived at (pound v.
serving).
(iii) Food sold in an unheated state is not subject to tax when commonly
sold in food stores in bulk by weight by the dozen (or part thereof) or by volume
(gallon, quart, etc.) for off-premises consumption.
(iv) Sales of heated and unheated food in combination on plates or as
dinners are subject to tax on the total charge.
Example 3: Cold cuts, salads and bakery products are sold by a restaurant
for home consumption. The restaurant charges its customer by the pound for the
cold cuts and salad and by the dozen or loaf for the bakery products. Such sales
are not taxable.
Opinion
Petitioner sells a product known as tomato pie. The New York State Department of
Agriculture & Markets does not deem it necessary for tomato pies to be kept or served at a
“holding temperature.” Tomato pies are made with bread dough and tomatoes, and are intended
to be consumed cold or at room temperature. Petitioner does not make sales for on premises
consumption. Petitioner also sells tomato pies by the slice. Purchases by the slice are delivered
to customers in a bag, or in a box for purchases of more than one slice, for off premises
consumption.
Petitioner’s description of the sales and packaging of its product indicates that
Petitioner’s sales practices are similar to those of food stores other than restaurants or other
establishments principally engaged in selling foods prepared and ready to be eaten. Petitioner
states it is not otherwise an establishment (diner, luncheonette, sandwich bar, etc.) engaged in the
sale of food or drink for on premises consumption. Petitioner’s sales of tomato pie in an
unheated state, and in the same form and condition, quantities and packaging as items of this
type are commonly sold in food stores other than those principally engaged in selling foods
prepared and ready to be eaten (i.e., in a bag or box as described in this Advisory Opinion), for
off premises consumption are not subject to sales tax under section 1105(d) of the Tax Law. See

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Sales Tax
December 14, 2004

5

section 527.8 of the Sales and Use Tax Regulations. Such sales of tomato pie are sales of baked
goods exempt from tax under section 1115(a)(1) of the Tax Law.

DATED: December 14, 2004

NOTE:

/s/
Jonathan Pessen
Tax Regulations Specialist IV
Technical Services Division

The opinions expressed in Advisory Opinions are
limited to the facts set forth therein.