What Groceries Are Taxed In Ontario? A Complete Guide For Ontario Residents

A lot of Ontario residents think that shopping for food items is tax-free in Ontario. This is not always the case. While most basic groceries are exempt from sales tax in Ontario, there are certain foods and beverages that are subject to HST (Harmonized Sales Tax).

When you know the list of groceries that are taxed in Ontario, you can manage your shopping list and budget accordingly. Follow this easy guide to know what groceries are taxed in Ontario, which items are tax-free, and how Ontario’s HST rules work.

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Basics Of The Grocery Tax In Ontario

A lot of people don’t know about the HST (Harmonized Sales Tax) system of Ontario. The HST combines –

• 5% federal GST
• 8% Ontario provincial tax

As a total, it comes out to be 13% HST on taxable goods and services. Most basic groceries are zero-rated in Ontario. This means 0% taxable. However, a lot of prepared food items, snacks, and beverages do not qualify for this list and are not considered part of basic groceries; thus, they are fully taxable.

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What Are The Basic Groceries In Ontario?

Basic groceries are essential foods that are purchased by people for their home consumption. The list of foods that fall under basic groceries is not taxed in Ontario.

• Fresh fruits and vegetables
• Meat, poultry items, and fish (frozen or fresh)
• Rice, pasta, and grains
• Eggs and dairy products (like milk, cheese, butter, yogurt, etc.)
• Cooking oil
• Spices
• Breads and bakery items without any sweet fillings
• Canned and frozen foods (without added sugar or preparation)
• Baby food and infant formula

All these food items are zero-rated, which means you don’t have to pay HST on them.

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Which Groceries Are Taxed In Ontario?

Apart from basic groceries, certain grocery items are considered non-essential or prepared foods. The food items falling under this category are taxable under HST rules.

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Snack Foods

Did you know that the most commonly taxed grocery item in Ontario is snack food? These include the following –

• Popcorn and chips
• Snack bars (protein bars, granola bars)
• Candy and chocolate bars
• Pretzels and cheese puffs
• Trail mix with any kind of candy or chocolate

All these items are subject to 13% HST.

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Soft Drinks And Sweetened Beverages

Most soft drinks and aerated beverages are taxable under HST, unless they meet specific criteria. Even powdered drink mixes and syrups that are used to make sweetened drinks are also taxable.

The list of taxable beverages includes –

• Soft drinks and soda
• Sports drinks
• Energy drinks
• Sweetened iced tea
• Lemonade and flavored drinks

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Prepared And Ready-to-eat Foods

Foods that are prepared and available for immediate consumption are part of taxable groceries in Ontario. It doesn’t matter if the food is served hot or cold; HST applies to ready-to-eat and prepared foods.

• Hot meals from grocery stores
• Heated bakery items
• Sushi trays
• Sandwiches and wraps
• Rotisserie chicken
• Prepared and ready-to-eat salads

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Bakery Items With Sweet Fillings

In the last section, we mentioned that breads and bakeries are part of basic groceries and are not taxed. But not all bakery items are tax-free. Some taxable bakery items include –

• Cakes and cupcakes
• Pastries with sweet fillings
• Muffins
• Doughnuts
• Cookies sold as single servings

Plain bread and unsweetened rolls are tax-free, and you don’t have to pay HST on them.

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Ice Cream And Frozen Dessert

All kinds of frozen treats and ice creams are usually taxable in Ontario. The list includes –

• Ice cream
• Ice cream bars
• Popsicles
• Frozen yogurt
• Ice cream sandwiches

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Groceries That May Be Partially Taxed In Ontario

Certain grocery items fall into the grey area, depending on their packaging and quantity.

Single Vs. Multiple Servings

Single-serving items like a muffin or a single beverage are usually taxable as part of the HST.

Multipacks or large quantities may be tax-free if they qualify as basic groceries.

For example, a single soda bottle is taxed, but large quantities may qualify differently based on their use.

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Restaurant Vs. Grocery Store Purchases

It also matters where you buy food from for the tax to be paid.

• When you buy food at restaurants, cafés, or food courts, it is always taxed.
• Food that you purchase at grocery stores may be tax-free if it falls into the category of basic groceries.
• Take-out meals are taxed the same as dine-in meals.
• Food that you buy in the grocery store (prepared food from hot counters) is also taxable.

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Tips To Save Grocery Tax In Ontario

Implement these practical tips to reduce grocery taxes in Ontario –

• Try to buy basic, unprepared foods
• Avoid single-serving snack items, as they are always taxable
• Choose unsweetened beverages
• Purchase larger quantities instead of individual packs to avoid HST
• Make sure to go through the receipt to understand what groceries are taxed and what is exempted

Be a smart buyer and understand these rules to help you make better shopping decisions.

This is general information only and not professional advice. Consult a professional before acting.