November 20, 1979

You request a ruling as to the application of the sales tax on meals to products sold on your business premises, which is located at a shopping mall.

You indicate that frozen cookies are baked on your premises, and are sold by the pound or individually. In addition, beverages such as fruit drinks, milk and coffee are sold in take out fashion. The premises contain no tables, chairs or other facilities for eating.

Massachusetts General Laws Chapter 64H, Section 6(h) exempts from sales taxation food products for human consumption other than meals provided by a restaurant. A meal is defined to include "food or beverages sold on a 'take out' or 'to go' basis, whether or not they are packaged or wrapped and whether or not they are taken from the premises of the restaurant." Bakery stores are excluded from the definition of "restaurant" except for any part of such a store which sells food products which are commonly sold at snack bars, coffee shops or luncheon counters.

Based on the foregoing, it is ruled that a business which sells beverages and cookies, as herein described, is a restaurant engaged in selling "meals" within the meaning of Chapter 64H and the food products sold therein are subject to the sales tax on meals.

However, if the business conducts both a restaurant and a bakery at the same location and it maintains separate records and books of account for each activity, the sales of baked goods such as cookies when sold in units of six or more by the bakery portion, are not subject to the sales tax on meals.

Our letter ruling dated October 9, 1979 (LR 79-39) is distinguishable from this ruling in that it involved only a bakery operation. The October 9, 1979 ruling is limited to its stated facts.

Very truly yours,

/s/L. Joyce Hampers

L. Joyce Hampers
Commissioner of Revenue

LJH/RSF/jmcd

LR 79-49