Are 'healthy' snack mixes of nuts, seeds, and dried fruit taxable as candy when they contain chocolate or honey coatings?

Plain-English summary

An online snack retailer that markets its products as healthy alternatives asked whether ten of its snack mixes are "candy or confectionery." Most were loose mixtures of nuts, seeds, and dried fruit combined with chocolate buttons/drops, fudge, honeycomb, or honey-and-sugar coatings. One was a formed bar of date paste, oats, dates, cocoa powder, and coconut, similar to a granola bar.

The Office of Counsel concluded nine of the ten are taxable candy. Food and food products are exempt, but candy and confectionery are not. By regulation, fruit, nuts, and seeds covered with honey, caramel, or chocolate are candy, and when an exempt food is sold combined with a candy item for a single price (like trail mix with chocolate), the entire mixture is taxable. The chocolate buttons, fudge, chocolate-covered honeycomb, and honey/sugar coatings turned each of those mixes into candy. The one exception, the date-paste bar, contained no candy ingredient (cocoa powder alone is not candy) and is like an exempt granola bar, so it is not taxable.

What this means for you

Snack makers and retailers

"Healthy" or "natural" branding does not control. If your product contains chocolate pieces, fudge, or honey/sugar-coated nuts or seeds, it is likely taxable candy, even if the rest is wholesome nuts and dried fruit. Mixing a candy component with exempt foods makes the whole package taxable.

Grocers and online sellers

Tax the full price of mixes that contain a candy ingredient. Plain bars and mixes with no candy component (cocoa powder is not candy) can remain exempt food.

Accountants and tax professionals

Apply 20 NYCRR 528.2(a)(4) and TB-ST-283: a single charge for exempt food combined with a taxable candy item is fully taxable. Watch the cocoa-powder-vs-chocolate line (TB-ST-135) and the fudge definition (TB-ST-103; TSB-A-09(54)S).

Common questions

Q: My mix is mostly nuts and dried fruit. Why is it taxable?
A: Because it also contains chocolate or a honey/sugar coating. Combining a candy component with exempt foods makes the entire mixture taxable.

Q: Is anything with cocoa taxable?
A: No. Cocoa powder by itself is not candy. A bar made with cocoa powder (but no chocolate pieces or coatings) can be exempt, like a granola bar.

Q: What made the one date-paste bar exempt?
A: None of its ingredients were candy or confectionery, and it resembles a non-taxable granola bar.

Q: Can I rely on this opinion?
A: It binds the Department only as to the petitioner. Use it as guidance and confirm your own facts.

Citations and references

Statutes and guidance:
- Tax Law § 1115; 20 NYCRR 528.2(a)(1), (a)(4)
- TB-ST-103; TB-ST-283; TB-ST-135; TSB-A-09(54)S

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales-ao-2020.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a20-20s.pdf

Original ruling text

New York State Department of Taxation and Finance
Office of Counsel

TSB-A-20(20)S
Sales Tax
June 23, 2020

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION
The Department of Taxation and Finance received a Petition for Advisory Opinion from
[ REDACTED ] (“Petitioner”). Petitioner asks whether ten of its products should be classified as
candy or confectionery subject to sales tax. We conclude that nine of these products are candy.
Facts
Petitioner is an on-line retailer of snack products. Petitioner markets these products as
healthy alternatives to traditional snacks. Petitioner asks whether the following snacks are
considered candy or confectionery for sales tax purposes: (A) [ REDACTED ]; (B)
[ REDACTED ]; (C) [ REDACTED ]; (D) [ REDACTED ]; (E) [ REDACTED ]; (F)
[ REDACTED ]; (G) [ REDACTED ]; (H) [ REDACTED ]; (I) [ REDACTED ]; and (J)
[ REDACTED ]. Petitioner’s petition included pictures of each product and the list of ingredients in
each product.
(A) [ REDACTED ] is a loose mixture of milk chocolate drops, dried coconut flakes,
and sweetened dried cranberries. The ingredients in milk chocolate drops include sugar, cocoa
butter, whole milk, cocoa mass, soy lecithin extract, and natural vanilla flavoring. The milk
chocolate drops are shaped as discs and appear to be the size of the dried cranberries.
(B) [ REDACTED ] is a loose mixture of mini chocolate cookies, roasted hazelnuts,
white chocolate buttons, and sunflower seeds.
(C) [ REDACTED ] is a loose mixture of pecans, dark chocolate buttons, sugar, and
sweetened dried cranberries.
(D) [ REDACTED ] consists of ginger fudge, walnuts, cinnamon-flavored raisins, and
carrot chews. Ginger fudge consists of sugar, glucose syrup, sweetened condensed milk, palm
oil, ginger crush, butter, soy lecithin, natural ginger flavoring, and salt. Carrot chews consist of
apple juice concentrate, apple puree concentrate, carrot juice concentrate, orange juice
concentrate, pectin, ascorbic acid, and citrus fiber.
(E) [ REDACTED ]. is a loose mixture of pumpkin seeds, dark chocolate buttons,
and sweetened dried cranberries

-2-

TSB-A-20(20)S
Sales Tax
June 23, 2020

(F) [ REDACTED ] is a loose mixture of roasted hazelnuts, orange infused raisins, and
dark chocolate buttons.
(G) [ REDACTED ] is a loose mixture of milk chocolate-coated honeycomb, raisins, and
almonds. The ingredients in milk chocolate coated honeycomb include milk chocolate, sugar,
glucose syrup, gum arabic, and shellac.
(H) [ REDACTED ] are formed bars containing date paste, rolled oats, almond milk,
dates, cocoa powder, desiccated coconut, apple fiber, and salt.
(I) [ REDACTED ], also known as [ REDACTED ], is a loose mixture of raspberry
infused cranberries, white chocolate buttons, and hazelnuts.
(J) [ REDACTED ] is a loose mixture containing roasted sunflower seeds, roasted
pumpkin seeds, sugar, honey, and natural vanilla flavoring.
White chocolate buttons and dark chocolate buttons are ingredients in a number of
Petitioner’s products. White chocolate buttons consist of sugar, cocoa butter, whole milk, soy
lecithin, and natural vanilla flavoring. Dark chocolate buttons consist of cocoa mass, sugar,
cocoa butter, soy lecithin, and natural vanilla flavoring. Both types of buttons are shaped as
discs and appear to be larger in size than a hazelnut and approximately the size of a pecan.
Analysis
Food and food products, except candy and confectionery, when sold for human
consumption, are exempt from sales tax. See Tax Law § 1115; 20 NYCRR 528.2(a)(1). Candy
and confectionery include, as relevant here, candy of all types, but, not: chocolate (plain or
mixed with other products), glazed or sugar-coated fruits, nuts, peanuts, and any other product
regarded as candy or confectionery based on its normal use or as indicated on the label or in the
advertising thereof. See 20 NYCRR 528.2(a)(4). The mere presence of sugar or honey in a
product does not make it candy or confectionary for sales tax purposes. However, fruit, nuts, and
seeds covered with honey, caramel, chocolate, or other similar coatings are considered candy or
confectionery. See 20 NYCRR 528.2(a)(4); TB-ST-103; TB-ST-283. When food that is exempt
from tax is sold in combination with a taxable item for a single charge, such as trail mix
containing chocolate, the entire charge is subject to sales tax. See TB-ST-283.
[ REDACTED ] contains milk chocolate drops, which are discs of chocolate and are
candy. When foods not classified as candy, such as dried coconut flakes and dried cranberries,
are mixed with chocolate candy, the entire mixture is classified as candy or confectionary.
Therefore, [ REDACTED ] is subject to sales tax.

-3-

TSB-A-20(20)S
Sales Tax
June 23, 2020

[ REDACTED ] contains white chocolate buttons, mini cookies and sunflower seeds.
White chocolate buttons are discs of chocolate and are candy. When foods not classified as
candy, such as sunflower seeds and cookies, are mixed with candy, the entire mixture is
classified as candy or confectionary. Therefore, [ REDACTED ] is subject to sales tax.
[ REDACTED ] is a loose mixture of pecans, dark chocolate buttons, sugar, and
sweetened dried cranberries. Dark chocolate buttons are discs of chocolate and are candy.
When mixed with the other ingredients in [ REDACTED ], the dark chocolate buttons make
the entire mixture candy or confectionary. Therefore, [ REDACTED ] is subject to sales tax.
[ REDACTED ] contains ginger fudge, walnuts, cinnamon flavored raisins, and carrot
chews. Merriam-Webster’s unabridged dictionary defines “fudge” as “a soft creamy candy made
typically of sugar, milk, butter, and flavoring.” Fudge is considered candy or confectionary, in
this case flavored with ginger. See, TB-ST-103, TSB-A-09(54)S. When the ginger fudge is
mixed with the nuts, raisins, and carrot chews, the entire mixture is candy or confectionary.
Therefore, [ REDACTED ] is subject to sales tax.
[ REDACTED ] is a loose mixture of dark chocolate buttons, seeds, and sweetened dried
cranberries. When the seeds and dried cranberries are mixed with dark chocolate buttons, the
entire mixture is candy or confectionery. Therefore, [ REDACTED ] is subject to sales tax.
[ REDACTED ] is a loose mixture of dark chocolate buttons, hazelnuts, and orangeinfused raisins. Hazelnuts and orange-infused raisins by themselves are not taxable, but become
taxable as candy or confectionary when mixed with dark chocolate buttons. Therefore,
[ REDACTED ] is subject to sales tax.
[ REDACTED ] contains pieces of honeycomb that are covered in chocolate. Foods that
are not otherwise candy become candy or confectionary when coated with chocolate.
Honeycomb covered in chocolate is candy and confectionary. Therefore, [ REDACTED ] is
taxable as candy or confectionary because the raisins and almonds are sold in a mixture that
includes chocolate covered honeycomb.
[ REDACTED ] contains date paste, rolled oats, almond milk, dates, cocoa powder,
coconut, apple fiber and salt. None of these ingredients, including the cocoa powder (see TB-ST135), are considered candy or confectionary and are not taxable by themselves. [ REDACTED ]
is similar to granola bars, which are not taxable. Therefore, [ REDACTED ] is not subject to
sales tax.
[ REDACTED ], also known as [ REDACTED ], is a loose mixture of white chocolate
buttons, sweetened cranberries, and hazelnuts. The cranberries and hazelnuts by themselves are
not taxable but become taxable as candy or confectionary when mixed with white chocolate
buttons. As such, this mixture is subject to sales tax.

-4-

TSB-A-20(20)S
Sales Tax
June 23, 2020

[ REDACTED ] is a mixture of seeds that are covered or coated with honey and sugar.
The seeds by themselves are not candy or confectionary, but they become candy or confectionary
when they are coated with honey and sugar. Therefore, [ REDACTED ] is subject to sales tax.
DATED: June 23, 2020

/S/
DEBORAH R. LIEBMAN
Deputy Counsel

NOTE: An Advisory Opinion is issued at the request of a person or entity. It is limited to the
facts set forth therein and is binding on the Department only with respect to the person
or entity to whom it is issued and only if the person or entity fully and accurately
describes all relevant facts. An Advisory Opinion is based on the law, regulations, and
Department policies in effect as of the date the Opinion is issued or for the specific time
period at issue in the Opinion. The information provided in this document does not
cover every situation and is not intended to replace the law or change its meaning.