Are Juice Plus capsules — made only of dried fruit and vegetable juices — exempt from Texas sales tax as food products, and what about the related Juice Plus Bars?

Plain-English summary

This letter responds to a distributor of Juice Plus capsules. The Comptroller's office explains that it had previously written to another individual about the same product, advising her that the capsules should be treated as exempt food products because they contain only dried fruit and vegetable juices, and are not advertised or promoted as anything other than fruit and vegetable juices.

The letter also notes that on November 18, 1994, the Comptroller's office had already told another Juice Plus distributor that the capsules were exempt as food products based on the facts presented. Because of that prior determination, this distributor is told to consider Juice Plus capsules exempt food products from November 18, 1994 forward.

The letter addresses what to do if sales tax was already collected: any tax collected must be reported, but if the distributor's representatives choose to refund that tax to the purchasers, the distributor would then be entitled to a refund of the tax once it has been refunded to the customers.

Finally, the letter states that the Comptroller had neither seen nor addressed the taxability of the separate "Juice Plus Bars" product, so that part of the request could not be answered at that time. A note at the end references a previous accession number (9503997L) for this same letter.

What this means for you

Sellers of dried fruit/vegetable juice capsules

If your product is made only of dried fruit and vegetable juices and is not marketed as anything other than fruit and vegetable juices, this letter indicates the Comptroller's office has treated comparable capsules as exempt food products, effective from the date of the underlying determination (November 18, 1994, for this distributor).

Handling sales tax already collected

If sales tax was collected on capsules before they were confirmed exempt, that tax must still be reported. However, this letter explains a path to a refund: if the seller refunds the collected tax to its purchasers, the seller becomes entitled to a refund of that tax once the purchasers have been repaid.

Related but different products (bars vs. capsules)

This ruling is limited to the capsule product. The letter is explicit that the Comptroller had not seen or evaluated the "Juice Plus Bars" and could not rule on their taxability in this letter — a reminder that an exemption determination for one product form doesn't automatically extend to a different product form from the same company.

Common questions

Q: Are Juice Plus capsules exempt from Texas sales tax?
A: According to this letter, yes — because they contain only dried fruit and vegetable juices and are not advertised or promoted as anything else, they are considered exempt food products.

Q: From what date does the exemption apply to this distributor?
A: The letter states that, based on an earlier determination made on November 18, 1994 for another Juice Plus distributor, this distributor should consider Juice Plus capsules exempt food products from November 18, 1994.

Q: What if sales tax was already collected on the capsules?
A: The letter says any tax collected must be reported. If the distributor's representatives choose to refund that tax to purchasers, the distributor is then entitled to a refund of the tax once it has been refunded to the purchasers.

Q: Does this letter also cover Juice Plus Bars?
A: No. The letter states the writer had neither seen the bars nor addressed their taxability, so that part of the request could not be answered at that time.

Citations and references

No specific statutes or administrative rules are cited in the text of this letter.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9503L1341G04

Original ruling text

March 20, 1995

Dear **:

Recently, I wrote *** concerning Juice Plus capsules. In my
letter, I advised her the capsules should be considered exempt food products
because they contain only dried fruit and vegetable juices. Furthermore, while
I did not make mention of it in the letter, the product is not advertised or
promoted as anything other than fruit and vegetable juices.

On November 18, 1994, our office advised another distributor of Juice Plus that
the capsules were exempt as food products based on the facts presented.
Therefore, from November 18, 1994, you should consider juice plus capsules
exempt food products.

If your representatives have been collecting sales tax, it must be reported.
However, if you choose to refund the sales tax to the purchasers, you would be
entitled to a refund of the tax once you have refunded it.

As regards the Juice Plus Bars, I have neither seen these bars nor addressed
their taxability. Therefore, I can not answer this part of your request at this
time.

Should you wish further information, please call me at 1-800-531-5441,
extension 3-4004, or write me at I I 1 E. 17th Street, Austin, Texas 78774.

Sincerely,

Wade Anderson
Assistant Director Tax Administration

NOTE: Previous Accession Number 9503997L