SEATTLE — Juliana Miura often buys bottled coffee drinks without a second thought about the price. “Every time I fill my gas, I buy one,” she chuckled outside a Renton ampm convenience store.
However, a KIRO 7 investigation has revealed a concerning issue: depending on where you purchase popular bottled coffee beverages, like Starbucks Frappuccinos, you may be incorrectly charged sales tax.
Understanding the Sales Tax Discrepancy
This issue is emerging across Washington’s convenience stores, from the North Sound to the South Sound. While some establishments charged no sales tax on bottled or canned coffee drinks, others tacked on approximately 50 cents for the same items.
The Washington State Department of Revenue has confirmed that these additional tax charges are incorrect.
The problem was initially uncovered by Action 9, a KIRO 7 sister station in Orlando, which led KIRO 7 to investigate whether a similar issue exists in Washington State.
We surveyed four convenience stores in Seattle, Bellevue, Renton, and Auburn, purchasing identical bottled coffee drinks.
Findings revealed that two stores imposed sales tax, while two did not.
For instance, at a Chevron in Bellevue, the tax added 45 cents to the purchase. Just a short distance away, another store sold the same drink without any tax.
“That’s pretty wild,” remarked Jose Perez Peralta of Renton. “I don’t think we should be paying extra.”
To confirm the tax discrepancy, KIRO 7 presented receipts to the Washington State Department of Revenue.
“Beverages that contain milk are exempt from sales tax,” explained Quinn Dickason, the education coordinator in the Taxpayer Services Division at the Washington Department of Revenue.
After reviewing several receipts, Dickason confirmed the taxes were incorrectly applied.
“I would say that’s incorrect,” she stated.
The rationale is as follows: In Washington State, grocery food is not subject to tax. While soft drinks like soda are taxed, beverages with over 50% juice or any milk are exempt.
This means that bottled coffee drinks that contain milk should be free from sales tax.
For customers already facing rising prices, small amounts can accumulate over time.
“Everything’s super expensive,” noted Fabricio Miura, an ampm customer. “We’re always working, trying to do our best. Even if it’s only 50 cents, we shouldn’t be paying that.”
To explore the extent of the issue, KIRO 7 visited more stores and quickly detected a consistent pattern.
All ampm convenience stores surveyed in Everett, Renton, Auburn, Tacoma, and Lacey applied sales tax on the same bottled coffee drinks.
A manager at a store in Auburn indicated that the sales tax policy is determined by corporate policy.
According to data from ScrapeHero, Washington state houses 127 ampm locations. At roughly 50 cents in tax per drink, this could significantly impact customers statewide.
“We pay without knowing,” said Fabricio Miura. “We didn’t check the receipts.”
His wife, Juliana Miura, shared that she purchases the drinks weekly.
At that yearly rate, customers could end up paying around $25 in sales tax on beverages that should qualify for an exemption.
KIRO 7 made repeated attempts to contact ampm corporate, through calls, emails, messages on X, and by filing a consumer complaint. After about two weeks, the corporate owner of ampm, BP, finally responded.
“Thank you for bringing this to our attention. We take compliance with local, state, and federal laws very seriously and are reviewing the issue,” stated Paul Takahashi, Head of U.S. Media Affairs with BP.
When asked about oversight, the Department of Revenue noted that it does not routinely audit businesses specifically for food tax compliance, but would revisit tax practices if a store were selected for a broader audit.
Despite KIRO 7’s findings, the department asserted that cases like this are relatively rare.
“I think you got lucky,” Dickason remarked. “Generally, people get it right… I don’t think there’s any malicious intent; it’s likely just human error,” she stated.
Some customers remain doubtful.
“I think it’s a little naive to think it’s just a mistake,” Miura commented. “But hopefully, it’s an error.”
As for refunds, the Department of Revenue advises customers to approach the store directly. If that does not resolve the issue, they may request a refund through the department’s website, although a receipt is necessary.
KIRO 7 remains vigilant in urging ampm to rectify the issue and will provide updates if the company alters its sales tax practices.
Key Takeaways
- Sales tax was inconsistently charged on bottled coffee drinks across various convenience stores in Washington.
- The Washington State Department of Revenue confirmed that beverages containing milk should be exempt from sales tax.
- Customers purchasing the affected coffee drinks may be unknowingly paying extra, totaling around $25 annually per customer.
- The Departments of Revenue do not routinely audit businesses for food tax compliance.
- BC, the owner of ampm, is reviewing the sales tax issues after being contacted by KIRO 7.
FAQ
Why are some bottled coffee drinks taxed while others are not?
The variance in tax charges is due to incorrect application of sales tax by some stores, despite beverages containing milk being exempt from tax according to state regulations.
How can I request a refund for the incorrect sales tax charged?
Customers should initially approach the store for a refund, and if unsuccessful, they can request a refund through the Washington Department of Revenue’s website, provided they have a receipt.
What should I do if I notice a tax discrepancy in my receipt?
It’s important to review your receipts and if you find a discrepancy, bring it to the store’s attention for clarification or correction.
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