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    • How much money will you actually save?
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    How much money will you actually save?

    Madoc Meredith Posted on

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    Grocery shopping just got a little cheaper in Oklahoma.

    The statewide 4.5% sales tax on many food items was officially removed from the books at midnight after a bipartisan group of lawmakers approved the change and Governor Kevin Stitt signed the law earlier this year.

    Here’s a breakdown of how much you can save and which foods are now exempt from Oklahoma grocery taxes.

    How much do I save with the tax relief on grocery shopping?

    Of course, the average savings an Oklahoma shopper makes over the course of a year depends on how much groceries they actually buy.

    Stitt has claimed that Oklahomans will save an average of $800 a year. Yet an individual or family would have to spend nearly $17,800 a year at the grocery store to avoid $800 in state sales tax.

    The Oklahoma Policy Institute has published calculations that break down the estimated savings based on annual income. According to their research, an Oklahoma family earning $40,000 a year is likely to save about $125 per year. A family at the higher end of the income scale (more than $619,000 per year) would save an average of $408 per year.

    The median household income in Oklahoma was $63,440 in 2022, the most recent year available.

    To calculate your own savings, check your grocery receipts and multiply the subtotal by 0.045. This isn’t a perfect result, though, because not everything you buy at a grocery store is tax-free.

    Do I still pay taxes on food?

    The short answer is probably that local governments can continue to collect sales taxes, although they have the option to adopt state laws.

    Oklahoma City’s sales tax remains at 4.125%, meaning someone shopping for groceries in Oklahoma City will now pay less than half the tax because the state portion is eliminated.

    According to the Oklahoma Municipal League, sales tax is the largest source of revenue for many Oklahoma municipalities. Municipal sales tax on groceries is especially important for rural communities without a diversified economy.

    Some foods will continue to be taxed

    Not every type of food is exempt from state sales tax. In general, the exemption applies to food and food ingredients that are intended for later preparation.

    Hot meals prepared by the seller for immediate consumption or delivered with cutlery remain subject to taxation.

    Here are some of the foods that will continue to be taxed:

    • Deli sandwiches made by the retailer
    • Hot soups and chicken
    • Sushi prepared by the seller
    • Dietary supplements
    • Takeaway and delivery service for restaurants
    • Food prepared in the cinema or at food stalls
    • Preheated food from the supermarket
    • Coffee or tea in a reusable cup
    • Alcoholic beverages
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    Madoc Meredith
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