Some well-known Iowa retailers are being sued for allegedly charging the Iowa sales tax on food that’s not supposed to be taxed. Iowa Federation of Labor president Mark Smith has filed a class action lawsuit on behalf of Iowans who he says have been over-charged by Younkers, T-J Maxx, Borders Book Stores and the Richman Gordman Half-Price Stores. At issue: charging Iowa sales tax on items like tea bags, boxes of cookies and jars of pasta. The sales tax is only to apply to food that can be consumed on the spot.Smith says the lawsuit seeks to stop the retailers from charging sales tax on certain food items, and to pay damages.Smith and others have been buying food products around the state for the past six months to spot check retailers — and the four chains failed their test.Smith says the law is clear — and he’s got the receipts and food products to prove the retailers were in the wrong.
