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Mixed Beverage Sales Tax
Who is responsible for this tax?
Mixed beverage permittees in Texas, as defined in Tax Code 183.001(b), must collect and remit a mixed beverage sales tax on each mixed beverage (distilled spirits, beer, ale and wine) they sell, prepare or serve. Mixed beverage sales tax is also due on each nonalcoholic beverage and on ice sold, prepared or served to be mixed with an alcoholic beverage and consumed on the premises of the mixed beverage permittee. The mixed beverage sales tax is in addition to mixed beverage gross receipts tax imposed on the mixed beverage permittee.
Unlike mixed beverage gross receipts tax, a mixed beverage permittee can pass the mixed beverage sales tax on to the customer by:
- adding a line item for the mixed beverage sales tax on the bill provided to the customer; or
- including mixed beverage sales tax in the sales price. A permittee’s records must show that the sales price of alcohol includes mixed beverage sales tax.
Before calculating gross receipts for mixed beverage gross receipt tax, the mixed beverage sales tax must be deducted from the amount received.
A mixed beverage permittee may state on invoices, receipts or bills one of the following:
that mixed beverage sales tax is included in the sales price (open this section to see a receipt example)
EXAMPLE 1
| Item | Amount |
|---|---|
| Dbl Cheeseburger | 5.25 |
| Fr Fries | 3.00 |
| Margarita frz (2) | 7.00 |
| TOTAL | 15.25 |
Sales and MB Sales taxes are included in sales price.
the amount of mixed beverage sales tax imposed on that sale (open this section to see a receipt example)
EXAMPLE 2
| Item | Amount |
|---|---|
| Dbl Cheeseburger | 4.75 |
| Fr Fries | 2.75 |
| Draft Beer (2) | 7.00 |
| Subtotal | 14.50 |
| Sales Tax | 0.62 |
| MB Sales Tax | 0.58 |
| TOTAL | 15.70 |
the combined amount of mixed beverage taxes on that sale (open this section to see a receipt example)
EXAMPLE 3
| Item | Amount |
|---|---|
| Dbl Cheeseburger | 4.75 |
| Fr Fries | 2.75 |
| Mexican Martini (2) | 7.00 |
| Subtotal | 14.50 |
| Sales Tax | 0.62 |
| MB Sales Tax | 0.58 |
| TOTAL | 15.70 |
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.
the combined amount of sales and mixed beverage sales taxes imposed on all items listed on that invoice (open this section to see a receipt example)
EXAMPLE 4
| Item | Amount |
|---|---|
| Dbl Cheeseburger | 4.75 |
| Fr Fries | 2.75 |
| Mexican Martini (2) | 7.00 |
| Subtotal | 14.50 |
| Sales and MB Sales Tax | 1.20 |
| TOTAL | 15.70 |
Provisions in Rule 3.1001, Mixed Beverage Gross Receipts Tax also apply to mixed beverage sales tax except for the mixed beverage gross receipts tax itself. For instance, information on record keeping, documentation and taxability for mixed beverage gross receipts tax also applies to mixed beverage sales tax.
The Alcoholic Beverage Code authorizes the Texas Alcoholic Beverage Commission to regulate alcoholic beverages, including issuing alcoholic beverage permits and collecting alcohol excise taxes.
Mixed Beverage Taxes – Purchases and Sales by Nonprofit and Exempt Organizations
Purchases of Mixed Beverages by Nonprofit and Exempt Organizations
Mixed beverage sales tax is administered, collected, and enforced in the same way as sales and use tax. The same exemptions may also apply.
Governmental Entities
A governmental entity that qualifies under Texas Tax Code Section 151.309, Governmental Entities is exempt from paying tax on the purchase of any item otherwise taxable under Texas Tax Code Chapter 151, Limited Sales, Excise, and Use Tax.
A governmental entity can claim exemption from paying mixed beverage sales tax on the purchase of mixed beverages otherwise taxable under Texas Tax Code Chapter 183, Mixed Beverage Taxes.
These governmental 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.
Title 34 of the Texas Administrative Code Rule 3.322(j), Exempt Organizations has additional information on diplomatic tax exemptions, including procedures for retailers.
Nonprofit Organizations
A nonprofit organization that qualifies for exemption under Texas Tax Code Sections 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 Texas 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.
Sales of Mixed Beverages by Nonprofit Organizations
Mixed Beverage Gross Receipts Tax
A seller who is a permittee listed under Texas Tax Code Section 183.001(b)(1), including a nonprofit entity temporary event permittee, is required to report and pay mixed beverage gross receipts tax on each mixed beverage sold, prepared or served for on-premises consumption.
There is no exemption on mixed beverage gross receipts tax. Entities and organizations that are exempt under Texas Tax Code Sections 151.309 and 151.310 must report and pay mixed beverage gross receipts tax.
A governmental entity or nonprofit organization is responsible for collecting mixed beverage sales tax on each mixed beverage sold, prepared or served for on-premises consumption. Nonprofit organizations that qualify for exemption from sales and use tax under Texas Tax Code Section 151.310 may sell alcoholic beverages tax-free during a qualifying fundraising sale or auction authorized by Texas Tax Code Sections 151.310(c) and 151.321.
For more information on obtaining an alcohol permit, contact the Texas Alcoholic Beverage Commission (TABC). For additional information on your mixed beverage tax responsibility, see Publication 96-1780, Mixed Beverage Taxes: What You Can Expect (PDF).
Rates
8.25 percent (.0825) on sales of mixed beverages.
Due Date
20th day of the month following the end of the reporting period.
Penalties and Interest
Penalties
- A $50 penalty is assessed on each report filed after the due date.
- If tax is paid 1-30 days after the due date, a 5 percent penalty is assessed.
- If tax is paid over 30 days after the due date, a 10 percent penalty is assessed.
Interest
- Past due taxes are charged interest beginning 61 days after the due date.
- To calculate interest on past due taxes, visit Interest Owed and Earned.
Reporting and Payment Requirements
Select the amount of taxes you paid in the preceding state fiscal year (Sept. 1 – Aug. 31) to find the reporting and payment methods to use.
Less than $10,000
Select one of these reporting methods:
Select one of these payment methods:
$10,000 - $49,999
Select one of these reporting methods:
Select one of these payment methods:
$50,000 - $499,999
Webfile is the only acceptable reporting method.
Select one of these payment methods:
$500,000 or more
Webfile is the only acceptable reporting method.
TEXNET is the only acceptable payment method.
Additional Resources
- Refunds
- Security Requirements for Texas Mixed Beverage Taxes
- Texas Alcoholic Beverage Commission
- Mixed Beverage Tax Receipts
- Local Mixed Beverage Tax Allocation Historical Summary
- Local Mixed Beverage Tax Allocation Comparison Summary
- Local Mixed Beverage Tax Allocation Payment Distribution Schedule