Court - Business cafeterias have to pay sales taxes

Wednesday, September 12, 2001

JEFFERSON CITY, Mo. -- Cafeterias in businesses still must collect and pay state sale taxes, even if they serve food only to the building's employees and approved visitors, the state Supreme Court said.

In a 5-2 decision Tuesday, the state's highest court rejected arguments that such cafeterias were exempt from a state law charging taxes at places where "meals or drinks are regularly served to the public."

An administrative hearing commission had ruled that the taxes were not due because the sales were not to the "public," but rather only a limited number of people

The Supreme Court disagreed, overturning the commission.

"Cafeterias do not become nonpublic merely because the buildings in which they are located happen to restrict access," Judge Laura Denvir Stith wrote for the majority.

Judges Ronnie White, John Holstein, Michael Wolff and Duane Benton concurred with the decision.

In a dissent, Judge William Ray Price Jr. and Chief Justice Stephen Limbaugh Jr. said the business cafeterias are not "public" in the ordinary use of the word.

The decisions came in two cases involving cafeterias run by J.B. Bening Co. in the St. Louis and Cape Girardeau areas and by Food Service Consultants in the St. Louis area.

J.B. Bening serves hot food, salads and owns vending machines in 13 manufacturing plants or business, the court said. J.B. Bening had collected sales taxes but had sought refunds from the state for a period covering October 1994 through February 1998.

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