Kitchen Table Economics

Halloween is Spooky, Taxes on Halloween Treats Are Even Spookier

In 2017, Americans spent roughly $8.4 billion on Halloween. More specifically, they spent $3.1 billion on costumes, $2.4 billion on decorations, $2.5 billion on candy and $390 million on greeting cards. But did you know much of these costs go to the government in taxes? That’s right, depending on what state you live in, a sales tax—which usually exempts food and other grocery products—can be applied to the cost of your Halloween treats.

For example, Indiana has a general state sales tax of 7 percent that is applied to all products, except for foods, beverages or other grocery products. However, candy is not exempt—which makes that jumbo bag of skittles or bag of mini snickers bars for trick-or-treaters a little bit more expensive.

These 5, 6 or 7 percent sales taxes on candy may not seem like it will add a big chunk to your bill at the cash register, but when applied to the billions of dollars spent on Halloween candy every year, those dollars add up quickly.

This Halloween, make sure to enjoy the sugary treats and clever costumes as trick-or-treaters ring the doorbell, but be sure to remember what the government is adding to your bill in the checkout line.