Candy and soda to be taxed in Aurora starting June 1

We’ve written about this before, but the city’s website says a new ordinance goes into effect June 1 allowing Aurora to begin collecting city sales tax of 3.75 percent on candy and soft drinks. Other pre-packaged food items are tax exempt, and prepared foods remain taxable.

This ordinance is effective June 1, 2012. However, a one month grace period will be extended to allow businesses time to change their point of sales systems to reflect the change in taxation and any other preparations they might need, according to the website. Businesses should start taxing candy and soft drinks on July 1, 2012. The first monthly tax return to be filed with candy and soft drink tax included will be due August 20, 2012.

The first quarterly tax return to be filed will be due October 20, 2012.

The new ordinance is an effort to address retailers’ tax concerns, but no additional revenue will be generated for the city since it’s a tax policy change.

Aurora City Council preliminarily approved the change unanimously at their council meeting on April 2.

The ordinance will redefine which food items are and aren’t subject to city sales and use tax, which is 3.75 percent. Instead of taxing food “marketed for immediate consumption,” the city will begin taxing candy and soft drinks just like the state. “What we said is let’s do the same thing the state does,” said Mike Hyman, assistant city attorney. “We’ll get rid of this tax on food marketed for immediate consumption and we’ll substitute it with the tax on candy and soft drinks right along the lines of the state. The retail community will be happy because they only have one system to implement.”

According to the ordinance, the term “candy” means a preparation of sugar, honey or other natural or artificial sweeteners in combination with chocolate, fruit, nuts or other flavorings in the form of bars, drops or pieces. It does not include any preparation containing flour and is not refrigerated.

The term “soft drinks” means any nonalcoholic beverage that contains natural or artificial sweeteners but do not include milk or milk products or milk substitutes. It also does not include beverages that have greater than 50 percent of vegetable or fruit juice by volume.

For more information, visit www.auroragov.org/taxregs or call 303-739-7800, option 2 or 3.