Most groceries you buy in Colorado are exempt from the state’s 2.9% sales tax on food in Colorado, but your receipt may still show a tax line because cities, counties, and special districts set their own rules. The state exempts food bought for home consumption. It does not exempt candy, soft drinks, prepared meals, dietary supplements, or tobacco, and local governments can tax groceries even when the state does not.
What the State Exemption Covers
Colorado exempts food purchased for home consumption from its 2.9% state sales tax.1Justia Law. Colorado Code 39-26-707 – Food, Meals, Beverages, and Packaging–Definitions That covers the everyday grocery list: produce, meat, dairy, bread, cereal, canned goods, frozen vegetables, and similar items you take home and prepare yourself.
Colorado’s definition of “food” tracks the federal food stamp program’s definition of items purchased for human consumption at home.1Justia Law. Colorado Code 39-26-707 – Food, Meals, Beverages, and Packaging–Definitions The test is whether the item is meant to be eaten off the premises where you bought it. If it needs some preparation before it becomes a meal, it almost certainly qualifies.
What Still Gets Taxed at the Register
Several categories look like groceries but do not qualify for the exemption. They carry the full 2.9% state rate plus any applicable local and special district taxes.
Candy and Soft Drinks
Candy is taxable at the state level.1Justia Law. Colorado Code 39-26-707 – Food, Meals, Beverages, and Packaging–Definitions Colorado defines it as a sweetened preparation combined with chocolate, fruit, nuts, or flavorings in the form of bars, drops, or pieces. One quirk decides many close calls: if the product contains flour, it is not candy. A plain chocolate bar is taxable. A cookie or a wafer-based bar may not be.
Soft drinks means any nonalcoholic beverage with natural or artificial sweeteners, which sweeps in soda, sweetened iced tea, energy drinks, and flavored waters with added sugar.1Justia Law. Colorado Code 39-26-707 – Food, Meals, Beverages, and Packaging–Definitions Two things are excluded from that definition and stay tax-exempt as groceries: beverages containing milk or milk substitutes such as soy, rice, or oat milk, and drinks that are more than 50% fruit or vegetable juice by volume.
Prepared Food
Food ready for immediate consumption is taxable wherever you buy it. Colorado’s regulation defines prepared food to include anything served at tables, chairs, or counters, and anything provided with trays, plates, or utensils.2Legal Information Institute. Colorado Regulation 39-26-102(4.5) All hot food, and any food the seller heats on the premises, counts as prepared food automatically.
The example that trips up shoppers: a raw chicken from the meat case is exempt because you cook it at home. The rotisserie chicken spinning ten feet away in the heated display is taxable because the store heated it. Same protein, different tax. The rule applies equally to restaurant meals, food trucks, hot bars, and catering.2Legal Information Institute. Colorado Regulation 39-26-102(4.5)
Supplements, Vitamins, and Over-the-Counter Medicine
Dietary supplements, vitamins, and over-the-counter medicines are not treated as food for home consumption and are fully taxable at the state and local level.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items Prescription drugs are exempt under a separate provision. If the label reads “Supplement Facts,” expect to pay the full sales tax rate.
Other Excluded Items
Tobacco products, chewing gum, and carbonated water in containers are also excluded from the grocery exemption.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items Nonessential packaging provided for the shopper’s convenience rather than to complete the sale is taxable at the 2.9% state rate as well.
How Local Taxes Change What You Pay
The state exemption is only half the picture. Cities, counties, and transit districts each set their own rules, and this is where most of the confusion on Colorado grocery receipts starts.
Home-Rule Cities
Colorado’s constitution lets home-rule cities set tax policy independently of the state, so a home-rule city can tax groceries even when the state exempts them. Among the ten most populous home-rule cities, six had adopted a food exemption and one taxed food at a reduced rate, though city councils can change these choices.4Colorado General Assembly. Food for Home Consumption and Retirement Communities Exemptions Check the specific city ordinance where you shop.
Statutory Cities and Counties
Statutory cities and counties whose sales taxes are collected by the state may choose whether to extend the food exemption to their local tax. Most have chosen to exempt groceries, mirroring the state.4Colorado General Assembly. Food for Home Consumption and Retirement Communities Exemptions If a local government does exempt food, it has to follow the state’s criteria for what counts as exempt.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items
RTD and SCFD in the Denver Metro Area
The Regional Transportation District (RTD) and Scientific and Cultural Facilities District (SCFD) cover most of the seven-county Denver metro area. Their taxes apply only to food items that are already subject to state sales tax, meaning candy, soft drinks, and prepared food.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items If an item is exempt at the state level, no RTD or SCFD tax is due on it.
So the layers stack like this. On exempt groceries, you pay no state tax and no special district tax, but you might still pay a city or county tax if that jurisdiction taxes food. On a taxable item like candy or a deli sandwich, you could see the 2.9% state rate, local city and county taxes, and RTD and SCFD rates all on the same line. The Colorado Department of Revenue publishes an address lookup that shows the combined rate for any location.5Department of Revenue – Taxation. How to Look Up Location Codes and Tax Rates
Buying With SNAP or WIC
Groceries paid for with SNAP benefits or WIC vouchers get broader protection than cash purchases. Items that would normally be taxable when paid for with cash, including candy, soft drinks, chewing gum, cold sandwiches, prepared salads, and deli trays, are exempt from the 2.9% state sales tax when paid for with SNAP or WIC.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items Seeds and plants for growing food for human consumption follow the same pattern: taxable in cash, exempt on SNAP.
Local governments that tax food still have to exempt any purchase made with food stamps or WIC vouchers.3Colorado Department of Revenue. Taxable and Tax Exempt Sales of Food and Related Items That protection runs at every level, so SNAP and WIC users should see no sales tax on eligible items regardless of the city.
The Retail Delivery Fee on Grocery Orders
If you order groceries for delivery, expect a separate charge on the receipt that is not a sales tax but sits next to one. Colorado imposes a flat retail delivery fee on any delivery containing at least one taxable item. For the period from July 2025 through June 2026, the fee is $0.28 per delivery, and it adjusts each July for inflation.6Department of Revenue – Colorado Taxes. Retail Delivery Fee Rates
The fee is per delivery, not per item. A cart made up entirely of exempt groceries triggers no fee. Adding a single bottle of soda or a bag of candy to that cart brings the fee into play.
Diapers and Period Products
Since January 1, 2023, Colorado has exempted diapers, incontinence products, and period products from the 2.9% state sales tax.7Colorado General Assembly. HB22-1055 Sales Tax Exemption Essential Hygiene Products These often sit on grocery store shelves alongside food, so the exemption changes your total on a routine shopping trip. Counties and municipalities can choose whether to adopt either exemption for their local taxes, so local treatment varies.