S.C. Code Regs. 117-305.5 — Exemption Meals Sold to School Children

Meals sold within school buildings, not for profit, to school children are exempted from the sales tax
by Section 12-36-2120(10). Further, foodstuffs sold to schools which are used in furnishing meals to
school children are also exempted from the sales and use tax by Section 12-36-2120(10). This
exemption is construed to include only sales of meals to pupils of kindergartens, grammar and high
schools, either public or private, and sales of foodstuffs to schools which are used in furnishing meals
for pupils of kindergartens, grammar and high schools, either public or private, where it can be shown
that the sale or use of the meals or foodstuffs occurs within the school building and there is not a profit
from such sale or use. Schools operating school lunch programs are required to obtain a retail license
and remit the tax on all sales of meals to persons other than school children.
Meals sold by any public or private educational institution or their agent, other than those exempted
by Section 12-36-2120(10), described above, are subject to the sales tax when a separate charge per
meal is made to the consumer. This includes cash sales, sales at special events and meals sold by
commissaries at such institutions. Tax on these sales must be remitted by the institution to the
department based on gross proceeds.
Educational institutions operating boarding facilities where meals and beverages are furnished
without a separate charge being made or where a lump sum charge is made by the month or by the
term are deemed to be the users or consumers of the prepared meals if same are purchased or
acquired, or the users or consumers of the unprepared food products if such educational institutions
or their agents purchase such products and prepare the meal. The seller of such prepared meals shall
be required to report and remit the tax due on the gross proceeds of such prepared meals to the
educational institution. The seller of unprepared food products to an educational institution or its
agent purchasing such products and preparing the meals shall be required to report and remit the tax
due on the gross proceeds of such raw foodstuffs.
Sales to consumers of prepared meals, foodstuffs or beverages on educational institution premises by
an entity other than the educational institution or its agent, are sales at retail and the seller is required
to obtain a retail license for each location, and report and remit the tax due on the gross proceeds of
such sales.