Mixed Beverage Taxes Frequently Asked Questions

For mixed beverage taxes, a permittee is a holder of one or more of the following issued by the Texas Alcoholic Beverage Commission (TABC):

• Mixed beverage permit.
• Private club registration permit.
• Private club exemption certificate.
• Mixed beverage or private club registration permit with a retailer late hours certificate.
• Mixed beverage or private club registration permit holding a food and beverage certificate.
• Nonprofit entity temporary event permit.
• Distiller’s and rectifier’s permit.

Permittees are subject to mixed beverage taxes (see "Obtaining an Alcohol Permit" section below).

A mixed beverage that is subject to mixed beverage taxes is any alcoholic beverage (wine, distilled spirit, or malt beverage including beer and ale), or part of an alcoholic beverage, that a permittee sells or serves to be consumed on the permittee’s premises. An alcoholic beverage is any beverage containing more than 0.5 percent of alcohol by volume.

There are two mixed beverage taxes, both based on the sale, preparation or service of alcoholic beverages and mixers. The permittee (seller) pays the mixed beverage gross receipts tax to the state, and the customer pays the seller the mixed beverage sales tax, which the seller remits to the state.

A permittee pays the mixed beverage gross receipts tax based on the total amount received from:

• The sale, preparation or service of mixed beverages; and
• Ice and nonalcoholic beverages that are sold, prepared or served to be mixed with an alcoholic beverage and consumed on the permittee’s premises.

Customers pay the mixed beverage sales tax on:

• Each mixed beverage a permittee sells, prepares or serves; and
• Ice and each nonalcoholic beverage a permittee sells, prepares or serves that is mixed with an alcoholic beverage and consumed on the permittee’s premises.

The mixed beverage gross receipts tax rate is 6.7 percent, and the mixed beverage sales tax rate is 8.25 percent.

Yes, the type of TABC permit or license determines whether sales of malt beverages and wine are subject to sales tax or mixed beverage taxes.

For example, a mixed beverage permittee’s sales of malt beverages or wine are subject to both mixed beverage taxes. However, sales of wine or malt beverages by a wine and malt beverage retailer’s permittee are only subject to sales and use tax as the holder of this permit is not a mixed beverage permittee.

No, a wine and malt beverage retailer’s permit is not a type of permit listed under the definition of a mixed beverage permittee. As such, your sales are subject to limited sales and use tax, not mixed beverage taxes.

Yes, you will collect mixed beverage taxes on all sales of alcohol because the permit you have is listed under the definition of a mixed beverage permittee. Sales by the holder of a mixed beverage permit are subject to both mixed beverage taxes.

Yes, you will collect mixed beverage taxes on all sales of alcohol because the permit you have is listed under the definition of a mixed beverage permittee. Sales by the holder of a mixed beverage permit are subject to both mixed beverage taxes.

Yes, when a permittee provides bartenders and/or wait staff who prepare or serve alcoholic beverages (even when the customer provides the alcohol), the related fees are subject to mixed beverage gross receipts tax and mixed beverage sales tax.

If you sell or serve the nonalcoholic beverage to be mixed with alcohol and consumed on premises, it is subject to mixed beverage taxes.

However, if you sell the nonalcoholic beverage (coffee) alone with no alcohol, it is only subject to limited sales and use tax.

As a mixed beverage permittee, when you sell, prepare or serve any alcoholic beverage for on-premises consumption, the sale is subject to mixed beverage gross receipts tax and mixed beverage sales tax.

Sales of alcoholic beverages for off-premises consumption are only subject to limited sales and use tax.

Mixed beverage taxes are due on alcoholic beverages sold for on-premises consumption by a mixed beverage permittee, such as a tasting fee at a distillery.

Alcoholic beverages sold for off-premises consumption, such as the sale of the discounted commemorative bottle of liquor, are subject to limited sales tax.

• Apply for a Texas Sales and Use Tax Permit.
• Print and complete the required prequalification packet from the Texas Alcoholic Beverage Commission (TABC).
• Take the packet to a Comptroller’s field office to be certified for sales and use tax. You must have a sales tax permit to have your packet certified by the Comptroller’s office.
• Post required security bonds with the TABC and the Comptroller’s office. The Comptroller’s office collects one security bond for mixed beverage gross receipts tax and one for mixed beverage sales tax to ensure against defaults on payments of the mixed beverage taxes.

Mixed beverage permit holders can allow their customers to pick up or take to-go alcoholic beverages for off-premises consumption—as well as deliver, or have delivered by a third party, alcoholic beverages to customers—if they meet certain requirements. For information on these requirements, please contact the Texas Alcoholic Beverage Commission (TABC).

Mixed beverage permit holders report alcohol sales that are consumed on premises on both your mixed beverage sales tax report (PDF) and on your mixed beverage gross receipts tax report (PDF).

However, pick-up, delivery or to-go sales of alcohol, including unopened wine, that are not consumed on the premises are not subject to mixed beverage taxes. These sales are only subject to limited sales and use tax and must be reported on your sales tax return.

No, you should file a separate mixed beverage sales tax report for your sales that are subject to mixed beverage sales tax.

You should report complimentary drinks on your mixed beverage gross receipts tax report (informational only), and report the cost of taxable ingredients used to prepare the complimentary drinks on your limited sales and use tax return as a taxable purchase.

No, these are separate taxes with separate forms:

• Form 67-100, Texas Mixed Beverage Gross Receipts Tax Report (PDF), and Form 67-101, Texas Mixed Beverage Gross Receipts Tax Report – Business Location Supplement (PDF).
• Form 67-103, Texas Mixed Beverage Sales Tax Report (PDF), and Form 67-104, Texas Mixed Beverage Sales Tax Report – Location Supplement (PDF).

You must file mixed beverage tax reports monthly.

Reports for mixed beverage taxes are due on or before the 20th day of the month following each reporting period, even if there are no mixed beverage sales to report. If the due date falls on a Saturday, Sunday or legal holiday, the next business day will be the due date.

No, but counties and cities receive a rebate of at least 10.7143 percent of the mixed beverage taxes revenue received from establishments within that county or city each fiscal quarter.

No, there are no timely filing or prepayment discounts for mixed beverage taxes.

If your business is affected by a declared disaster, you may qualify to receive an extension of time to file and pay taxes due. Please see our Disaster Relief Information webpage for additional information on requesting an extension.

The law imposes a $50 late filing penalty on every report filed late, even if no tax was due.

If a tax payment is made late, the permittee is also liable for penalty and interest on the tax due:

• If 1-30 days late, a penalty of 5 percent (0.05).
• If more than 30 days late, a penalty of 10 percent (0.10).
• On the 61st day after the due date, interest begins to accrue.

We will estimate your tax due and issue a Notice of Tax/Fee Due. If you do not file the report or pay the tax within 20 days, we will assess an additional 10 percent penalty on the tax owed.

The 6.7 percent mixed beverage gross receipts tax cannot be added to or deducted from the sales price of alcoholic beverages. To calculate your mixed beverage gross receipts tax, do not include mixed beverage sales tax in the amount you received.

For mixed beverage sales tax, you can collect the 8.25 percent tax from the customer by either adding the tax to the price of the alcoholic beverage or by including mixed beverage sales tax in the selling price of the alcoholic beverage. However, you must choose one method and cannot alternate between the two methods.

EXAMPLE: A permittee had $1,000 in taxable mixed beverage sales and/or services during a reporting period and added mixed beverage sales tax to the sales price of alcoholic beverages.

For mixed beverage sales tax:

• Report $1,000 in total mixed beverage taxable sales (Item 6 on Form 67-103, Texas Mixed Beverage Sales Tax Report (PDF)).
• Multiply $1,000 by the 8.25 percent (0.0825) mixed beverage sales tax rate: $1,000 • 8.25 percent = $82.50.
• Report $82.50 as the total mixed beverage sales tax due (Item 8 on Form 67-103).

For mixed beverage gross receipts tax:*

• Report $1,000 as the total gross taxable amount (Item 11 on Form 67-100, Texas Mixed Beverage Gross Receipts Tax Report (PDF)).
• Multiply $1,000 by the 6.7 percent (0.067) mixed beverage gross receipts tax rate: $1,000 • 6.7 percent = $67.
• Report $67 as the total amount due for mixed beverage gross receipts tax (Item 12 on Form 67-100).

*For mixed beverage gross receipts tax, the gross sales of liquor, beer and wine are reported separately for each location.

EXAMPLE. A permittee had $1,000 in taxable mixed beverage sales and/or services during a reporting period and included mixed beverage sales tax in the sales price of alcoholic beverages.

For mixed beverage sales tax, the permittee would:

• Back out the 8.25 percent (0.0825) mixed beverage sales tax by dividing $1,000 by 1.0825: $1,000 ÷ 1.0825 = $924 (rounded up).
• Report $924 in Total Mixed Beverage Taxable Sales (Item 6 on Form 67-103, Texas Mixed Beverage Sales Tax Report (PDF)).
• Multiply $924 by the 8.25 percent (0.0825) mixed beverage sales tax rate: $924 • 8.25 percent (0.0825) = $76.23.
• Report $76.23 as the total mixed beverage sales tax due (Item 8 on Form 67-103).

For mixed beverage gross receipts tax:*

• The permittee subtracts the $76.23 in mixed beverage sales tax from the $1,000 in mixed beverage sales: $1,000 - $76.23 = $924 (rounded up).
• Report $924 as the total gross taxable amount (Item 11 on Form 67-100, Texas Mixed Beverage Gross Receipts Tax Report (PDF)).
• Multiply $924 by the 6.7 percent (0.067) mixed beverage gross receipts tax rate: $924 • 6.7 percent = $61.91.
• Report $61.91 as the total amount due for mixed beverage gross receipts tax (Item 12 on Form Form 67-100).

*For mixed beverage gross receipts tax, the gross sales of liquor, beer and wine are reported separately for each location.

For mixed beverage sales tax, a mixed beverage permittee may state one of the following on invoices, receipts or bills:

EXAMPLE 1

Mixed beverage sales tax is included in the sales price

Sales and MB Sales taxes are included in sales price.

EXAMPLE 2

The amount of mixed beverage sales tax imposed on that sale

EXAMPLE 3

The combined amount of mixed beverage taxes on that sale

Included in bill: Customer pays $0.58 on this sale of alcohol. Not included in bill: [Business Name] pays 6.7% tax ($0.47) on this sale of alcohol. Total amount paid to state on alcohol $1.05.

EXAMPLE 4

The combined amount of sales and mixed beverage sales taxes imposed on all items listed on that invoice

For mixed beverage gross receipts tax, a mixed beverage permittee may state either of the following on invoices, receipts or bills:

EXAMPLE 1

A separate statement of the amount of mixed beverage tax the permittee will pay on the customer's purchase of alcohol.

Not included in bill: [Business Name] pays 6.7% tax ($0.47) on this sale of alcohol.

EXAMPLE 2

A statement of the combined amount of mixed beverage gross receipts tax the permittee will pay and mixed beverage sales tax imposed on the customer’s purchase of alcohol.

Included in bill: Customer pays $0.58 on this sale of alcohol. Not included in bill: [Business Name] pays 6.7% tax ($0.47) on this sale of alcohol. Total amount paid to state on alcohol $1.05.

A mandatory gratuity charge is not taxable if the charge is:

• A "reasonable mandatory gratuity charge," meaning the charge does not exceed 20 percent of the sales price of alcoholic beverages;
• Separately identified as a tip, gratuity, service charge or by other reasonable means; and
• Disbursed to qualified employees.

"Qualified employees" are the employees who customarily and regularly provide the service upon which a gratuity is based. These include, but are not limited to, servers, busboys, bartenders, wine stewards and maîtres d’hôtel.

Not included are janitorial help, chefs, cashiers, dishwashers or owners. Any portion of a reasonable mandatory gratuity charge that is disbursed to nonqualified employees, or retained by the owner, is taxable.

The policy on gratuities for mixed beverage taxes is the same as the policy for limited sales and use tax as stated in Sales and Use Tax Rule 3.337, Gratuities.

No, for a mandatory gratuity charge that is more than 20 percent, the entire gratuity charge is taxable no matter how it is disbursed.

No, there are no exemptions from mixed beverage gross receipts tax.

Yes. mixed beverage sales tax is administered, collected and enforced the same way as sales and use tax, the same exemptions apply.

Government entities

A government entity that qualifies under Texas Tax Code Section (TTC) 151.309, Governmental Entities is exempt from paying tax on the purchase of any item otherwise taxable under TTC Chapter 151, Limited Sales, Excise, and Use Tax.

A government entity can claim exemption from paying mixed beverage sales tax on the purchase of mixed beverages otherwise taxable under Tax Code Chapter 183, Mixed Beverage Taxes.

These government entities include:

• The U.S. federal government and its agencies and departments (including branches of the military).
• Texas state and local government agencies, cities, counties, public schools, school districts and state institutions of higher education.

This exemption does not apply to personal purchases an agency employee makes, even if the employee is traveling on official business and the employee will be reimbursed.

Foreign diplomatic and consular personnel: Foreign diplomatic and consular personnel who present a Personal or Mission Tax Exemption Card issued by the U.S. Department of State are exempt from paying mixed beverage sales tax, unless the exemption card specifically excludes purchasing alcoholic beverages. Diplomatic tax exemption cards may have different levels of tax exemption that are described on each card.

The Office of Foreign Missions administers the foreign diplomatic program, including how vendors can verify tax exemption cards.

Sales tax Rule 3.322(j), Exempt Organizations has additional information on diplomatic tax exemptions, including procedures for retailers.

Nonprofit organizations

PURCHASES: A nonprofit organization that qualifies for exemption under Tax Code 151.310, Religious, Educational, and Public Service Organizations or 151.321, University and College Student Organizations is exempt from paying tax on the purchase of any item otherwise taxable under Tax Code Chapter 151 when the item purchased relates to the organization’s purpose.

However, the purchase of alcohol does not normally relate to the purpose of an exempt organization. Therefore, most sales to nonprofit organizations are not exempt from mixed beverage sales tax.

Nonprofit organizations include:

• Nonprofit charitable, educational and religious organizations.
• 501(c)(3), (4), (8), (10) or (19) organizations.
• Nonprofit youth athletic organizations.
• Volunteer fire and medical service departments.
• Chambers of commerce and convention and tourism promotional agencies.
• Qualified university and student organizations.

SALES: These organizations can sell alcoholic beverages tax free during a qualifying tax-free fundraising sale or auction authorized under Tax Code 151.310(c) and 151.321.

To sell alcoholic beverages, the exempt organization must have the appropriate permit from the Texas Alcoholic Beverage Commission. Again, there are no exemptions for mixed beverage gross receipts tax.

Yes, sales by the holder of a nonprofit entity temporary event permit are subject to mixed beverage taxes. Your sales of malt beverages and wine are subject to both mixed beverage gross receipts tax and mixed beverage sales tax.

A nonprofit entity temporary event permit is listed under the definition of a mixed beverage permittee.

No, there is not a specific mixed beverage exemption certificate. Qualified entities should issue a completed Form 01-339 (Back), Texas Sales and Use Tax Exemption Certificate (PDF). Governmental entities may also issue a purchase voucher to claim the tax exemption.

An exemption certificate can be signed by anyone the entity authorizes to make purchases on its behalf. This exemption does not apply to personal purchases an employee makes, even if the employee is traveling on official business and will be reimbursed.

Our Texas Tax-Exempt Entity Search lists entities that have been issued a letter of exemption from franchise, limited sales and use, and hotel occupancy taxes. The list may not include governmental entities not required to apply for exemption under Texas law.

An exempt verification letter printed from this search is not a substitute for a completed exemption certificate (PDF).

A Texas state agency, state university or college qualifies for exemption from mixed beverage sales tax under Tax Code 151.309, Governmental Entities. The university or its authorized agent must issue a properly completed Texas Sales and Use Tax Exemption Certification (PDF) to claim the exemption. Alternatively, the university can issue a purchase voucher as proof of exemption. An exemption certificate must be issued to claim a mixed beverage sales tax exemption when a university’s credit card or state-issued travel procurement card is used to purchase alcoholic beverages.

This exemption does not apply to personal purchases by an employee of the university, even if the employee is traveling on official business and will be reimbursed.