Food Tax in Arkansas: 0% State Rate, Local Taxes, and Exemptions

As of January 1, 2026, the food tax in Arkansas at the state level is zero. The state sales tax on qualifying groceries dropped from 0.125% to 0%, so a bag of flour or a gallon of milk carries no state sales tax at the register.¹ Your receipt will not be tax-free, though. City and county sales taxes still apply in most parts of the state, and three categories sold alongside groceries never qualified for the reduced rate in the first place: prepared food, candy, and soft drinks. Those still get taxed at the full 6.5% state rate plus whatever local tax applies.

How Arkansas Got to 0%

The zero rate is the end of a long walk-down. Act 1274 of 2009 created a separate, reduced rate for food and food ingredients under Arkansas Code § 26-52-317, and successive legislatures kept nudging it lower until it sat at 0.125% for years. Act 1008 of 2025 set the conditions for the final drop to zero, and once the Secretary of the Department of Finance and Administration confirmed those conditions were met, the state rate went to 0% on January 1, 2026.¹

What changed is only the state-level tax on qualifying food and food ingredients. Local taxes were not touched, and neither was the full state rate on prepared food, candy, and soft drinks.

What Counts as a Tax-Exempt Grocery

Arkansas uses the Streamlined Sales Tax Agreement definition to decide what qualifies. “Food and food ingredients” covers what people buy to prepare meals at home: raw fruits and vegetables, meat, poultry, fish, dairy, bread, cereals, canned goods, and similar staples.¹ Items that a store only cuts, repackages, or pasteurizes still count as food ingredients rather than prepared food. Raw eggs, fish, meat, and poultry that require cooking by the consumer to prevent foodborne illness also stay on the ingredient side of the line.

The 0% state rate applies to all of these. Local rates still apply to them.

What’s Still Taxed at the Full State Rate

Three categories keep the full 6.5% state sales tax plus local taxes: prepared food, candy, and soft drinks.²

Prepared Food

Arkansas defines prepared food using three tests. An item only has to meet one of them to be taxed at the full rate.³

Food sold in a heated state, or heated by the seller at any point before the sale. Rotisserie chicken, deli soup, and warm bakery items all qualify. Food that was heated earlier and has since cooled still counts.
Two or more food ingredients combined by the seller for sale as a single item, such as store-made pasta salad or a custom trail mix. Food that was merely cut, repackaged, or pasteurized is the carve-out.
Food sold with eating utensils provided by the seller: plates, forks, spoons, napkins, or straws. If a store makes utensils available at a self-service station and its prepared-food sales exceed 75% of total food sales, all food it sells can be treated as prepared food.

Candy and Soft Drinks

Candy and soft drinks are specifically carved out of the “food and food ingredients” definition, so the reduced rate never covered them. They stay at 6.5% state plus local. Arkansas also imposes a separate excise tax on soft drinks at the manufacturer and distributor level, which is already built into the shelf price you pay.⁴

Local City and County Taxes Still Apply

This is where most Arkansas shoppers still see tax on the grocery line. Cities and counties impose their own sales taxes through voter-approved ordinances, and those local rates apply to food and food ingredients the same way they apply to any other taxable good. Combined local rates run above 3% in some areas and closer to 1% in rural counties with fewer levies. A bag of rice at a store in a city with a 2% combined local rate will show 2% tax on the receipt, not zero. The Arkansas Department of Finance and Administration publishes updated local tax rate charts broken down by city and county.⁵ Retailers charge the rate for each store’s location, not a chain-wide average.

SNAP and WIC Purchases

Food bought with Supplemental Nutrition Assistance Program (SNAP) benefits or Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) benefits is exempt from all sales tax, state and local. This is a federal requirement and applies regardless of how the item would otherwise be taxed, so prepared food, candy, and soft drinks purchased with SNAP or WIC come through at zero tax as well.⁶ When you split payment between SNAP benefits and cash or a card, only the SNAP-covered portion is exempt. The rest is taxed normally.

Delivery and Online Grocery Orders

When groceries are delivered, the tax on the delivery charge follows the tax on the items. Order food and food ingredients that carry 0% state tax and the delivery charge on those items is also not subject to state sales tax. Order prepared food or other fully taxable items and the delivery charge is taxable. An order that mixes the two generally has the delivery charge split proportionally.⁷ One exception: when a common carrier bills the freight charge directly to the buyer rather than the seller including it on the invoice, that charge is not subject to sales tax regardless of what shipped.

Out-of-state grocers shipping into Arkansas play by the same rules once they exceed $100,000 in sales or 200 transactions in the current or preceding year.⁸ They collect 0% state tax on qualifying food, full state and local tax on prepared food, candy, and soft drinks, and the applicable local rate based on the delivery address.

Income Tax Credit for Metabolic Disorder Foods

Arkansas offers a separate income tax credit for families with a dependent child diagnosed with phenylketonuria (PKU), galactosemia, organic acidemias, or disorders of amino acid metabolism. The credit is worth up to $2,400 per year per child for the cost of medically necessary foods and low-protein modified food products, and any unused credit carries forward two additional tax years.⁹

This is not a checkout exemption. You still pay whatever sales tax applies at the register, then claim the credit on your state return by filing Form AR1113 with documentation of the diagnosis and the amounts spent on qualifying products. General health items such as meal replacement shakes, protein powders, and vitamins do not qualify. The federal definition of “medical food” requires a product formulated for consumption under a physician’s supervision and intended for the specific dietary management of a disease with distinctive nutritional requirements.¹⁰

1
Justia Law. Arkansas Code 26-52-317 – Food and Food Ingredients
2
Justia Law. Arkansas Code 26-52-301 – Tax Levied
3
Code of Arkansas Rules. 26 CAR 31-103 – Prepared Food
4
Arkansas Department of Finance and Administration. Soft Drink Tax
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Arkansas Department of Finance and Administration. State Sales and Use Tax Rates
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Arkansas Department of Finance and Administration. Food and Food Ingredients – Act 141 of 2017
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Arkansas Department of Finance and Administration. Sales and Use Tax FAQs
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Arkansas Department of Finance and Administration. Remote Sellers
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Arkansas Department of Finance and Administration. Arkansas Individual Income Tax Phenylketonuria Disorder and Other Metabolic Disorders Credit AR1113
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Office of the Law Revision Counsel. 21 USC 360ee – Grants and Contracts for Development of Drugs for Rare Diseases and Conditions