According to the law of the state of Indiana, any business selling goods to the public must collect sales tax and transfer the collected amount to the state.
As of 2015, Indiana levies a 7 percent sales tax on non-taxable items. It also levies a 7 percent tax on the use of goods purchased outside the state, including via the Internet, but for which the seller did not collect sales tax.
Items exempt from sales tax in Indiana include most food items, with some exceptions, including candy, chewing gum, pet food, paper products, and marshmallows. As a rule, any dish that was cooked or otherwise prepared before it was sold is subject to sales tax. For this reason, raw peanuts are exempt but honey-roasted peanuts are not.
In addition, alcohol is subject to sales tax, as are soft drinks, tobacco, vitamins and toothpaste.
Indiana also taxes gastronomic goods that are heated and taken out of the place of purchase.
Some buyers are exempt from paying sales tax in the state of Indiana.
This includes tax-exempt organizations, as well as persons who buy goods for resale or for production purposes.
In addition, goods shipped outside the state are exempt.
Buyers applying for an exemption must submit an exemption certificate, Form ST-105.
Without a certificate, the buyer must pay the sales tax and apply for a refund.