Publication 118, Vending Machine Food Sales

June 2023

Seller's Permit

We designed this publication to help you properly apply and pay sales tax for food sales you make through vending machines, which is generally understood to be a physical "machine" which dispenses items that it holds or makes upon deposit of cash, coins, credit, or other consideration into a slot. An item that can be accessed by a customer prior to payment, or that is not physically dispensed from the machine immediately after payment, is not considered to be sold through a vending machine.

Vending machine operators generally need seller’s permits

You generally need a seller’s permit if you make sales through a vending machine. You need only one permit, regardless of how many machines you operate (the operator of the vending machine is the person who stocks the machine and collects money from it).

There are some exceptions. If you sell food through a vending machine for a price of 15 cents or less per item, you do not need a seller’s permit. Certain groups do not need a seller’s permit because their vending machine sales are not taxable. For example, parent-teacher associations or equivalent school or library support groups do not need a seller's permit for vending machine sales (see publication 18, Nonprofit Organizations).

You can register for a seller’s permit on our website at by selecting Register, and then select Register a New Business Activity. You can also register in person at any of our field offices. For assistance you may contact our Customer Service Center at 1-800-400-7115 (CRS:711). Customer service representatives are available to assist you Monday through Friday from 7:30 a.m. to 5:00 p.m. (Pacific time), except state holidays.

Please note: This publication summarizes the law and applicable regulations in effect when the publication was written as noted above. However, changes in the law or in regulations may have occurred since that time. If there is a conflict between the text in this publication and the law, decisions will be based on the law and not on this publication.

Applying and Reporting Tax

Applying tax to vending machine food sales

Tax generally applies to the sale of food in vending machines (see Exceptions, below). However, certain sales of food items from vending machines are only partially taxable.

Partially taxable food sales. In a store, the sale of cold food items and individual hot drinks to go is generally exempt from sales tax. For example, tax does not apply when a grocery store sells candy, chips, fruit juice, and cups of hot coffee to go. However, the sale of those same items through a vending machine is partially taxable. Tax applies to 33 percent of your gross receipts from vending machine sales of cold food products (including noncarbonated water) and hot drinks.

Exceptions: There are two exceptions. Tax does not apply to:

  1. Bulk sales of candy and other food items in a coin-operated vending machine for 25 cents or less, and
  2. Sales of purified drinking water dispensed into a customer's container when the water enters the vending machine through local supply lines.

Fully taxable sales. All carbonated beverages and hot food products (other than hot beverages) sold through vending machines are fully taxable, just as they would be in a store or at a restaurant. If you sell products other than food in vending machines, those sales are generally taxable.

Please note: You must keep adequate and complete records. Be sure to keep separate records of your partially taxable and fully taxable sales.

Properly reporting tax on your sales

We presume that the sales price of items you sell in a vending machine includes an amount for sales tax reimbursement. When you complete your sales and use tax return, you must deduct that tax from your gross sales. Otherwise, you will pay too much sales tax with your return (see Sales Tax Factors).

Sales Tax Factors

Calculating the tax you owe

Use the table below to calculate the amount of tax you owe. This table will help you deduct the tax amounts included in your sales and to determine your taxable gross receipts. Factors are shown for 100 percent taxable sales and 33 percent taxable food sales. Please see the Partially taxable food sales section of the Applying and Reporting Tax tab for further details on when to use the 33 percent taxable factors. Be sure to use the correct factor for the tax rate in effect at the vending machine's location. For information about tax rates in specific areas, please select California City and County Sales and Use Tax Rates.

Tax rate Factor for tax calculation
  100% taxable 33% taxable
7.250 93.2401 32.2289
7.375 93.1315 32.2160
7.500 93.023332.2030
7.625 92.9152 32.1900
7.750 92.8074 32.1771
7.875 92.6999 32.1641
7.975 92.6140 32.1538
8.000 92.5926 32.1512
8.125 92.4855 32.1383
8.225 92.4001 32.1280
8.250 92.3788 32.1254
8.350 92.2935 32.1151
8.375 92.2722 32.1125
8.475 92.1871 32.1022
8.500 92.1659 32.0996
8.625 92.0598 32.0868
8.725 91.9752 32.0765
8.750 91.9540 32.0739
8.875 91.8485 32.0610
8.975 91.7642 32.0508
9.000 91.7431 32.0482
9.125 91.6380 32.0353
9.225 91.5541 32.0251
9.250 91.5332 32.0225
9.375 91.4286 32.0097
9.500 91.3242 31.9969
9.625 91.2201 31.9841
9.750 91.1162 31.9713
9.875 91.0125 31.9586
10.000 90.9091 31.9458
10.250 90.7029 31.9203
10.500 90.4977 31.8949
10.750 90.2935 31.8695

To compute the 100% taxable sales tax factor for other tax rates the formula is as follows:

100% taxable factor percentage = 100 divided by [1 + tax rate (decimal form)]

Example: 100% taxable factor at 7.25% = 100 divided by (1 + .0725) = 100 ÷ 1.0725 = 93.2401%

To compute the cold food factor for other tax rates the formula is as follows:

Cold food factor percentage = 100 divided by [3.0303 + tax rate (decimal form)]

Example: Cold food factor at 7.25% = 100 divided by (3.0303 + .0725) = 100 ÷ 3.1028 = 32.2289%

  1. Please see the Partially taxable food sales section of the Applying and Reporting Tax tab.

Taxable gross receipts worksheet—sample calculation

The table below shows how to properly calculate the taxable gross receipts from vending machine sales and which figures to carry to your sales and use tax return. The example shows $25,000 in total taxable sales: $15,000 in 100 percent taxable sales and $10,000 in 33 percent taxable sales. This example uses a tax rate of 8.25 percent, but you must use the rate in effect where your machines are located. If you have vending machines in locations with different tax rates, you will need to complete separate worksheets for each rate and combine totals to prepare your return.

Example 100%
taxable sales
taxable sales
Total of A+B
round and carry to return line indicated
1. Gross sales including tax $15,000.00 $10,000.00 $25,000 to return-gross sales
2. Taxable sales percentage factor (see table above) × 92.3788% × 32.1254%  
3. Taxable receipts without tax (gross sales including tax times taxable sales percentage factor) $13,856.82
($15,000 × .923788)
($10,000 × .321254)
4. Tax rate (use rate where machines are located) × 8.25% × 8.25%  
5. Tax included in sales (taxable receipts without tax times tax rate) $1,143.19
($13,856.82 × .0825)
($3,212.54 × .0825)
$1,408.22 to return-sales tax included
6. Tax exempt food sales (column B only; gross sales including tax minus taxable receipts without tax minus tax included in sales) n/a $6,522.43
($10,000 − $3,212.54 − $265.03)
$6,522.43 to return-sales of food products

Additional Information

Customer Service Center

Additional information and all CDTFA forms, publications, and regulations are available from our website or by calling our Customer Service Center at 1‑800‑400‑7115 (CRS:711). Customer service representatives are available to assist you Monday through Friday from 7:30 a.m. to 5:00 p.m. (Pacific time), except state holidays.

Taxpayers' Rights Advocate (TRA)

The TRA Office helps taxpayers when they are unable to resolve a matter through normal channels (for example, by speaking to a supervisor), when they want information regarding procedures relating to a particular set of circumstances, or when there are apparent rights violations.

Please visit the Taxpayers' Rights Advocate Office page on our website at You may also contact the Taxpayers' Rights Advocate at 1‑888‑324‑2798 or 1‑916‑324‑2798. Their fax number is 1‑916‑323‑3319. If you prefer, you can write to:

Taxpayers' Rights Advocate, MIC:70
California Department of Tax and Fee Administration
PO Box 942879
Sacramento, CA 94279-0007


18 Nonprofit Organizations

44 District Taxes


1574 Vending Machine Operators

1602 Food Products

1603 Taxable Sales of Food Products

Other Helpful Resources

  • Local and District Tax Guide for Retailers — A tax guide for retailers to learn more about how to properly collect, report, and pay local and district taxes.
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