Yes. Sales of tangible personal property by nonprofit agencies, including food and beverages, are subject to the business tax. An exempt organization pays business tax on tangible personal property it sells if the gross is more than $3,000. The ‘umbrella’ that protects an exempt entity from paying taxes does not cover operations that are not the ‘usual and customary’ operations. For example, a church would be usually exempt, but if it were selling books from its bookstore that the church had bought to sell to church members, it would pay business tax just like any bookstore doing retail sales.
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