What Is Exempt from Sales Tax in Kansas? Groceries, Drugs, Farm Inputs

Kansas charges a 6.5% state sales tax on most retail sales, but the Kansas Retailers’ Sales Tax Act exempts a long list of specific purchases. The biggest categories exempt from sales tax in Kansas are grocery food (state portion), prescription drugs and certain prescribed medical equipment, direct purchases by governments and qualifying nonprofits, manufacturing machinery, farm equipment and agricultural inputs, inventory bought for resale, most electronically delivered digital products, lottery tickets, motor fuel already subject to excise tax, and residential water.¹ Local sales taxes usually still apply on top of the state rate, so an “exempt” item at the state level may still show tax on your receipt depending on the city and county.

Groceries

As of January 1, 2025, the Kansas state sales tax rate on food and food ingredients is 0%.² That covers unprepared food sold for human consumption: produce, meat, dairy, canned goods, bread, baking supplies, and the rest of a typical grocery run. Alcoholic beverages, tobacco, and dietary supplements don’t qualify and are still taxed at the full state rate.

The grocery exemption stops at prepared food. If the seller heats the item, hands you utensils with it, or prepares it for you, Kansas treats it as a prepared food subject to the full 6.5% state rate. A raw chicken from the meat case is exempt; a rotisserie chicken from the deli counter is not. Local sales taxes also still apply to groceries in most jurisdictions, so expect a line of tax on your receipt even after the state portion is gone.

Prescription Drugs and Medical Equipment

Prescription drugs dispensed by a licensed practitioner are fully exempt under K.S.A. 79-3606(p). The statute defines “drug” broadly, covering any compound in the U.S. Pharmacopeia or National Formulary intended to diagnose, cure, or treat disease.¹ Over-the-counter medications bought without a prescription are taxable.

A separate exemption under K.S.A. 79-3606(r) applies to prosthetic devices, mobility enhancing equipment, oxygen delivery equipment, kidney dialysis equipment, enteral feeding systems, and hearing aids, in each case when prescribed by a licensed health care provider.¹ Replacement parts and batteries for hearing aids are included. Mobility enhancing equipment covers items like wheelchairs, but not motor vehicles or standard vehicle features.

One point that trips people up: general durable medical equipment like hospital beds and CPAP machines is not exempt for most buyers. The exemption for that category applies only to purchases made directly by nonprofit nursing homes for patient care.³

Government, Schools, Hospitals, and Religious Organizations

The State of Kansas, its political subdivisions, and federal agencies pay no sales tax on direct purchases under K.S.A. 79-3606(b). The same provision covers nonprofit hospitals, public hospital authorities, and nonprofit blood, tissue, and organ banks, as long as the purchases are used exclusively for the organization’s governmental or charitable purpose.¹

Public and private elementary schools, secondary schools, and nonprofit educational institutions qualify under K.S.A. 79-3606(c) for purchases used primarily in nonsectarian programs. Contractors hired by these institutions to build, repair, or expand facilities can also buy materials tax-free for that specific project if they obtain the proper exemption certificate from the institution.¹

Religious organizations with federal 501(c)(3) status are exempt under K.S.A. 79-3606(aaa) for purchases used exclusively for religious purposes. The exemption also reaches materials a contractor buys for construction or remodeling on the organization’s behalf, though tools and equipment the contractor uses on the job stay taxable. The contractor must get a project-specific certificate from the organization and keep all invoices for five years. Misusing the certificate for materials not incorporated into the project is a criminal misdemeanor.¹

Manufacturing, Farming, and Resale

Manufacturing Machinery

Under the integrated production exemption at K.S.A. 79-3606(kk), manufacturers and processors can buy machinery and equipment used as an integral part of their production operations without paying sales tax. Installation, repair, maintenance services, and replacement parts for that machinery are also exempt.¹ The design is that the tax gets collected once, when the finished product reaches the consumer, instead of being stacked on every input along the way.

The line between exempt production machinery and taxable supplies can be fuzzy. Equipment that directly transforms raw material into a finished product generally qualifies. Consumables like cleaning solvents and disposable filters are treated case by case depending on their role. When equipment serves both production and non-production purposes, Kansas typically looks at its predominant use.

Farm Equipment and Ag Inputs

K.S.A. 79-3606(t) exempts farm machinery and equipment, along with repair parts and maintenance services. The definition is wider than most people assume. It includes precision farming technology such as GPS systems, yield monitors, and soil-testing sensors used in computer-assisted farming, and work-site utility vehicles with cargo beds.¹ Standard passenger vehicles, trucks, and non-farm trailers don’t qualify. Each buyer must certify in writing on the invoice that the equipment will be used only in farming, ranching, or aquaculture.

Seeds, tree seedlings, fertilizers, herbicides, pesticides, and fungicides used to produce plants or prevent soil erosion on agricultural land are separately exempt under K.S.A. 79-3606(mm).¹

Inventory for Resale

Goods purchased for resale in the regular course of business are not taxed at the point of purchase. The buyer must hold a valid Kansas sales tax registration number and be in the business of selling the same kind of property.¹ If any of that inventory later gets used for personal or in-house business purposes instead of being resold, the buyer owes the sales tax on those items and has to report it to the Kansas Department of Revenue.⁴

Digital Products and Software

Kansas generally does not tax electronic downloads of digital products like movies, music, photographs, and e-books. The state treats these as intangible rather than tangible personal property, which puts them outside the sales tax base.⁵ Cloud-based software sold on a subscription basis (SaaS) is generally not taxable either.

Prewritten software is the main exception. Kansas taxes prewritten software regardless of how you receive it, whether on a disc, by download, or through a load-and-leave installation. Custom software developed specifically for one buyer is not taxable. Television and radio subscriber services delivered over the internet, including digitized pay-per-view content, are taxable as subscriber services.⁵

Other Exempt Categories

Kansas lottery tickets and shares are exempt from both state and local sales tax under K.S.A. 74-8721.⁶
Gasoline, diesel, and other motor fuels that already carry a separate Kansas excise tax are exempt from the retailers’ sales tax under K.S.A. 79-3606(a).¹
Water delivered through mains or pipes to residential premises for noncommercial use is exempt under K.S.A. 79-3606(w).¹
Tangible personal property bought by a railroad or public utility for direct and immediate use in interstate commerce is exempt under K.S.A. 79-3606(f).¹
A one-time, nonrecurring sale of tangible personal property by someone not in the business of selling that type of property is exempt under K.S.A. 79-3606(l). Selling used furniture through a local classifieds listing is a typical example. The Kansas Department of Revenue reads “nonrecurring” as one such sale within a 12-month period.

Don’t assume home utilities beyond water are exempt. Residential electricity, natural gas, and heat are not currently exempt from Kansas sales tax. An earlier exemption for those utilities under K.S.A. 79-3606(w) expired at the end of 2005, and the full state rate now applies to residential energy bills.¹

How to Claim an Exemption

Qualifying for an exemption and actually getting it at the register are two different things. To avoid paying tax on an exempt purchase, you have to give the seller a completed exemption certificate before or at the time of sale. Kansas uses different forms depending on the exemption. Form ST-28A is the resale exemption certificate for registered businesses buying inventory they’ll resell; only goods for resale qualify, not tools, supplies, or equipment the business will use itself.⁴ Form ST-28M is a multi-jurisdiction certificate used when the purchase crosses state lines, such as an out-of-state wholesaler buying inventory in Kansas without a Kansas registration number.⁷ Separate forms exist for governments, nonprofits, religious groups, and schools, and all of them are collected in Publication KS-1520.⁸

Every certificate has to include the buyer’s name and address, a description of the property, the seller’s name, and the specific reason the purchase qualifies. Nonprofits also need to provide their exempt entity tax identification number. The form must be signed and dated, and incomplete certificates get rejected.⁸ Sellers can accept valid certificates in good faith; once one is on file, the burden of proving a sale wasn’t taxable moves from the seller to the certificate.¹ Both buyers and sellers have to keep copies for the current year plus at least three prior years so state auditors can verify exempt transactions.

Misuse carries real consequences. The Kansas Department of Revenue can impose a penalty of $250 or 10 times the tax owed per transaction, whichever is greater, on top of the unpaid tax when a buyer misuses a resale certificate. Issuing a fraudulent exemption certificate to avoid sales tax is a misdemeanor punishable by a fine of up to $1,000, up to one year in jail, or both. Those penalties fall on the buyer, not the seller, as long as the seller accepted the certificate in good faith.⁸

1
Kansas Office of Revisor of Statutes. Kansas Code 79-3606 – Exempt Sales
2
Kansas Department of Revenue. Food Sales Tax Rate Reduction
3
Kansas Department of Revenue. Opinion Letter O-2010-006 – Sales Tax on Medical Items
4
Kansas Department of Revenue. ST-28A Resale Exemption Certificate
5
Kansas Department of Revenue. Revised Sales Tax Guidelines – Taxing Charges for Computer Software and Digital Products
6
Kansas Office of Revisor of Statutes. Kansas Code 74-8721 – Kansas Lottery, Sale of Tickets
7
Kansas Department of Revenue. Multi-Jurisdiction Exemption Certificate
8
Kansas Department of Revenue. Exemption Certificates Pub. KS-1520