Meals Tax

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Virginia collects sales tax at lower rate 2.5% (1.5% state and 1% local government) on grocery and other food items intended for home consumption. Fast food establishments and restaurants generally do not qualify for a lower sales-tax rate, even if patrons order takeout with the intent of eating at home.

Albemarle County

Albemarle is among the majority of counties in Virginia authorized to levy a food and beverage tax at a rate of up to 4 percent with the approval of the voters by referendum. The referendum may be certified for the ballot by resolution of a county board of supervisors or by a petition signed by at least 10 percent of registered voters. Five counties in Virginia have been statutorily exempted from the referendum requirement and can adopt meals taxes by ordinance (Arlington, Frederick, Montgomery, Roanoke, and Rockbridge Counties). However, town and city councils are not subject to the 4 percent cap and have been granted the right to levy meals taxes through ordinance rather than referendum.

Charlottesville

Effective July 1, 2019, the City of Charlottesville's Prepared Food and Beverage Tax Rate is 6.0%. There is also a State Sales Tax imposed on Prepared Food and Beverages at the rate of 5.3% [1]

On April 1, 2019, with the intent of addressing the city's affordable housing needs with additional funding, the City Council voted 4 to 1 to increase the meals tax (and the lodging tax). On July 1, 2019, the meals tax rate within the City of Charlottesville will increase from 5.0% to 6.0% on all prepared edible refreshments, nourishments, and liquids to include alcoholic beverages[2]

Scottsville

The meals tax rate in Scottsville will be increasing starting July 1, 2019. On June 17, 2019, the Scottsville Town Council voted unanimously to increase the meals tax rate from 4% to 4.5%. The increase in funds will be allocated to capital reserves in the town’s fiscal year 2020 budget.[3]

The council had advertised an increase to 5% and had discussed options at a work session in May 2019. The Town of Scottsville's entire budget is $690,020 for FY2020, including $35,351 toward capital projects.



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