11 States That Tax Your Groceries

With inflation on the rise and prices seeming to skyrocket everywhere, many people certainly are struggling to save money on groceries. Luckily, food prices are only expected to rise 1.1% in 2025, according to the USDA Food Price Outlook.

Twelve of the 45 states with a sales tax charge statewide taxes on groceries on top of any local or municipal taxes collected. Among those 12, some states offer lower tax rates on food or a rebate for you to claim on your tax return, but others tax groceries based on the total sales tax rate.

Editor's note: These rates are subject to change due to frequent alterations to sales tax regulations. 

Alabama is one of the few states that applies the whole state sales tax rate of 3% to food and groceries, a reduction from 4% as of September 2023. 

Alabama's also combines state and local taxes on groceries, which can reach 10% in some areas of the state.

Mississippi has a relatively low cost of living, but groceries are still taxed at 7%. An upside to this high rate is that local taxes are not allowed on groceries in addition to the state tax. 

South Dakota policymakers recently tried eliminating the 4.2% state tax on groceries, but the measure failed to pass at the ballot box.

With applicable local taxes combined, your grocery bill can get pricey quickly, which isn't great if you're on a tight budget.

Eligible seniors can participate in the Senior Box Program, which is available in all 66 counties. The program helps older individuals living on a fixed income. Individuals 60 or older with a household income at or below 130 percent of the federal poverty income guidelines can qualify.

Food, medications, and medical appliance sales in Illinois are only subject to a 1% tax rate, plus applicable local taxes. However, the governor has signed legislation eliminating 1% tax on groceries starting in 2026.

The state also taxes candy, soda, and alcohol at the state tax rate of 6.25%, plus any municipal taxes. Illinois is one of 18 states that says treats prepared with flour aren't candy, so they're taxed as regular groceries. For example, a regular chocolate bar is subject to more than six times the tax charged on a chocolate bar containing cookie pieces.

Missouri charges a reduced sales tax rate of 1.225% on grocery items, down from the standard sales tax rate of 4.225%. This includes food for in-home consumption and also includes plants or seeds to grow your own produce. Local taxes may still apply, and depending on the county you live in, may add 2% to 6% to your overall grocery bill.

Virginia has eliminated the 1.5% state sales tax on groceries, reducing the tax rate to 1% statewide. However, localities can still impose an additional 1% tax on groceries, resulting in a combined rate of up to 2%.

Additionally, certain essential personal hygiene products, such as diapers, incontinence pads, and feminine hygiene products, are taxed at the reduced 1% rate. ​

Therefore, while the state has reduced the grocery tax, local taxes may still apply, and essential personal hygiene products are subject to the reduced tax rate.

As of 2025, Utah imposes a 3% combined sales tax on groceries, consisting of 1.75% state tax, up to 1% local, and 0.25% county tax.

Alcohol and tobacco are taxed at 4.7%, plus local taxes. Prepared foods, like those from delis or heated items, are taxed at a higher rate, which can reach up to 8.7%, depending on the county.

Arkansas taxes groceries at a highly reduced rate of 0.125%, plus local taxes. Candy and soft drinks are taxed at a 6.5% sales tax rate, the same as non-food items such as toothpaste or ice. The tax code stipulates that anything called candy cannot include flour; otherwise, it's considered food and subject to the reduced tax rate.

Hawaii does not have a state sales tax but imposes a General Excise Tax (GET) of 4% on all business activities, including groceries. Additionally, counties can add a surcharge of up to 0.5%, resulting in a combined rate of up to 4.5% in certain areas.

Hawaii offers a refundable Food/Excise Tax Credit to low-income residents. Eligibility begins to phase out for individuals with a federal Adjusted Gross Income (AGI) of $40,000 or more, and for joint filers with an AGI of $60,000 or more. To claim this credit, individuals must file a tax return and complete a separate form.

Therefore, while Hawaii's tax structure may not be ideal for cost-saving, the state provides a refundable food tax credit to assist low-income residents.

Tennessee doesn't charge income tax, but it does have a sales tax rate of 7% plus any additional local or municipal tax.

Groceries are charged a reduced sales tax rate of 4%, but prepared food, including bakery goods, hot soup, deli dishes, candy, and alcohol, are taxed at the 7% sales tax rate.

​As of February 2025, Idaho imposes a state sales tax rate of 6% on groceries. To offset this, the state offers a refundable grocery tax credit averaging $120 per person. This credit applies to most residents, with an additional $20 for individuals aged 65 or older.

Recently, legislation has been introduced to increase the grocery tax credit to $155 per person, regardless of age, starting in the fiscal year 2026.

Therefore, while the current credit is $120 per person, pending legislation aims to increase it to $155 in 2026.

Taxes on food and groceries are controversial because food costs tend to take up a more significant proportion of the monthly budget for lower-income families.

As tax season approaches, check out the best tax software, and don't forget that small amounts of tax add up, especially on necessities like groceries.

Pay attention to your receipts and investigate your area's grocery and food taxes to know what to expect and plan accordingly.