New York City has some of the best bagels in the world. If you buy a whole bagel, then you don’t pay tax on it. The state’s tax officials treat it the same as any other food item like apples or bananas. If you want your bagel sliced, though, you have to pay an extra 8 percent sales tax.
That’s because slicing the bagel makes it a prepared, and therefore taxable, item. You also have to pay the tax if you want to eat it in the store. Chives, lox, and cream cheese will also add the tax.
Although it has been on the books for years, this tax was news to bakeries throughout New York. Until 2009, the state Department of Taxation and Finance largely ignored the law.