Are slivered almonds considered “processed” nuts? Is a frozen sandwich that you heat in the microwave a “pre-cooked” meal? Is an 8-ounce pepperoni stick considered a “meat snack?”

These are a few of the questions readers raised following our story about the Jan. 1 implementation of Maine’s expanded food tax, which includes hundreds of grocery store items that previously were tax-free.

To find the answers, business reporter J. Craig Anderson selected several food items to purchase at southern Maine’s three biggest grocery chains to test whether they are being taxed under the new rules.

But before we get to his results, first a note about consistency: Whether you agree with the expanded food tax, our largest supermarket chains at least appear to be interpreting the new rules in the same way. Shaw’s, Hannaford and Wal-Mart stores were consistent with each other when it came to taxing (or not taxing) the items we tested.

Here’s Craig’s report:

1) Fritos Brand Bean Dip Original Flavor

The state’s new rules say that savory “dips” should be taxed, but that “spreads” should not. What about a product that calls itself a dip but has the consistency of a spread? Apparently, if Frito-Lay considers its bean product a dip, Maine retailers are not in a position to argue. All three retailers we tested taxed the product at 5.5 percent.

2) Ocean Spray Ruby Red No Sugar Added 100% Juice

This product clearly should not be taxed under the new rules, but we tested it anyway because it sits on store shelves right next to dozens of juice products that are now considered taxable. The difference is that this Ocean Spray product crosses the state’s threshold of being at least 50 percent real fruit or vegetable juice. Most Ocean Spray products contain less than 50 percent juice, which now requires them to be taxed in Maine as “soft drinks.” All three grocery chains made the correct call and did not tax the 100% juice product.

3) Hormel Pepperoni (8-ounce stick); Bridgeford Pepperoni (7-ounce stick)

One interesting aspect of Maine’s expanded food tax is that it is less concerned with what a product is made of than how that product is used. Pepperoni is a perfect example: Small, snack-size sticks of pepperoni are considered “meat snacks” and are therefore taxed, while larger pepperoni sticks are considered ingredients in a meal and are therefore tax-exempt. We set out to test the 8-ounce Hormel stick, but Shaw’s was out of them, so we also purchased a 7-ounce Bridgeford stick. Neither was taxed by any of the retailers.

4) Lean Cuisine Craveables Chicken Club Panini; Stouffer’s Smoked Turkey Club Panini

The new tax rules for frozen meals seem to leave open the possibility that products such as these two “panini” frozen sandwiches could be taxed. According to the state, a pre-cooked, frozen food product should be taxed even if it requires “toasting, microwaving or otherwise heating or thawing … for palatability rather than for the purpose of cooking the product.” Both panini products contain meat and bread that already have been cooked, along with unmelted cheese. Apparently, the need for consumers to melt the cheese at home is sufficient to make these panini products tax-exempt. Neither was taxed at the three supermarkets.

5) Sliced almonds (Diamond, Hannaford and Everyday Essentials brands)

According to Maine Revenue Services, the new food tax applies to “nuts and seeds that have been processed or treated by salting, spicing, smoking, roasting or other means.” However, “raw nuts and seeds processed into a different form, such as peanut butter, are exempt grocery staples.” So what about unsalted, raw, sliced almonds used for cooking and baking? Do “other means” of processing include slicing? Apparently not, as none of the three retailers added tax on the sliced almond products.

Overall, it appears that Maine grocery chains have chosen to err on the side of consumers when it comes to items that are on the line between taxable and tax-exempt. Now, if only Frito-Lay would rename its product Bean Spread …

Business Editor Carol Coultas can be contacted at 791-6460 or at:

ccoultas@pressherald.com

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