Krispy Kreme Doughnut Corp. v. Director of Revenue

Summary

The Missouri Supreme Court reviewed whether Krispy Kreme's retail food sales qualified for Missouri's reduced one-percent sales tax rate under the statutory 80/20 test. The Court held that food prepared for "immediate consumption on or off the premises" includes food eaten at the place of purchase, while traveling to another location, or immediately upon arrival without further preparation. It reversed the Administrative Hearing Commission's decision granting the Director of Revenue summary decision and remanded for further proceedings.

Holdings

1. Under section 144.014.2, "food prepared by such establishment for immediate consumption on or off the premises" means food actually eaten at the place of preparation and purchase, while traveling to another location, or immediately upon arrival at another location without further preparation. The test does not include all food merely capable of immediate consumption, nor is it determined solely by purchase quantity, elapsed time after preparation, or the customer's ultimate destination.
2. Neither Krispy Kreme nor the Director of Revenue was entitled to summary decision because neither established entitlement to a favorable decision under the correct interpretation of the substantive law.

Questions Presented

1. What does the phrase "food prepared by such establishment for immediate consumption on or off the premises" mean under Missouri's 80/20 sales-tax test?
2. Whether the undisputed facts entitled either party to summary decision before the Administrative Hearing Commission.
3. Whether the AHC was authorized to sustain the Director of Revenue's motion for summary decision and deny Krispy Kreme's refund claim.

Disposition

reversed_and_remanded