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Virginia grocery tax dropping to 1%

Amid higher prices everywhere, groceries are about to get a little cheaper.

VIRGINIA, USA — Over the last year, we've seen prices go up on everything across the board, but Virginians are about to see a bit of relief when they hit the grocery store in 2023.

Taxing groceries isn't super common in the United States, but Virginia is one of the few states that does tax groceries.

According to CNBC, only 13 states in the Union tax groceries, and while Virginia is no Mississippi when it comes to the grocery tax, Virginians have been getting taxed 2.5% at the supermarket. Mississippi taxes at 7%.

The good news for consumers in Virginia is that the state is lowering its tax rate on groceries in the new year. The new rate: 1%.

However, the tax reduction doesn't apply to all things at the grocery store. Things like alcohol, tobacco, hot food that is prepared "for immediate consumption," and seeds and plants used to grow food.

Also, the state of Virginia has a list of food services that won't be included in the tax reduction because they're considered to sell prepared foods. Those include the following:

  • caterers
  • concession vendors
  • entertainment facilities (theme parks, stadiums, etc.)
  • fair and carnival vendors
  • gift shops
  • hamburger and hot dog stands
  • honor snack vendors
  • ice cream stands and trucks
  • mobile food vendors
  • movie theaters
  • newsstands
  • vending machine vendors

WATCH NEXT: New laws in DC, Maryland, and Virginia in 2023

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