New York Bagel Tax Discrimination? White Bread Slices Tax Exempt

by NowPublic Staff | August 24, 2010 at 09:38 am

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New York State Enforcing Obscure Bagel Tax- White Bread Exempt, Bruegger's Bagels Forced To Pay

Albany's crack down on bagels by enforcing a bagel tax on sliced bagels is costing at least one bagel franchise big money according to the Wall Street Journal.

Kenneth Greene, the owner of 33 Bruegger's Bagel franchises throughout New York, says the state demanded that he start charging taxes on all bagels, except for those that remain intact and are consumed off premises, and forced him to pay a "significant" sum in taxes that the state estimated he owed

So just to get that straight in the state of New York a bagel is taxed ( about 8 cents a bagel) if it is sliced and eaten in the store. However, the WSJ goes on to report that...

One source of confusion is that the rule isn't spelled out in the tax code. And while sliced bagels are subject to sales tax, a sliced loaf of bread at a bakery isn't, according to tax officials.

Hmm... sliced bagel taxed but sliced bread not taxed? Can you say discrimination? It is unclear if the tax applies to Kaiser buns, croissants, hot buns (minus the hot dog) or cheese buns.

One suspects that (considering the sorry state of New York's finances) soon a tax will apply to all wheat based breads and a double tax to any bread made with flax seed.