The food and beverage tax affects the resort area of Ocean City. This local sales tax on food and beverages is imposed for the purpose of paying the principal and interest on bonds issued to finance the construction, reconstruction, repair, renovation and equipment of the Convention Center.
The tax rate is one-half percent (.5%) of the taxable price of the sale of food and beverages. All sales of food and beverage are subject to the tax except the following cases:
- Sale of beer, wine and distilled spirits for OFF PREMISES consumption.
- Sale of candy or confectionery.
- Sale of food or beverages for consumption OFF PREMISES by a substantial grocery or market business. (A business in which at least 10% of all sales of food and beverages are sales of grocery or market food items not including food normally consumed on the premises even though it is packaged to carry out).
- Sale of food or beverage from a vending machine.
- Sale of food that is exempt from the state sales and use tax Under Section 11-206 of the Tax-General Article of the Annotated Code of Maryland. This includes the sale for consumption off the premises of crabs and seafood that are not prepared for immediate consumption.
The person collecting the tax shall contact the County Treasurer's Office for an application form. After completing all items on the form, the County will process the application and send forms for reporting tax collections.
Each month the person collecting the tax shall prepare a report showing the amount of gross sales, taxable sales and total tax collected for the reporting period. This report, with the tax remittance shall be made to the County Treasurer's Office on or before the 21st day of each month for the previous month's sales.
According to Section TR 1-901(f) of the Taxation and Revenue Article of the Code of Public Local Laws of Worcester County, taxes unpaid shall be charged interest at the rate of one and one-half percent per month from the due date. If the taxes remain unpaid for a period of thirty days from the due date, a penalty of ten percent shall be added, and an additional ten percent for each additional ninety days that such tax is not paid.
Office of the Treasurer
P.O. Box 248
Snow Hill, MD 21863
(410) 632-0686 ext. 1208