Prepared food sold by an Arkansas restaurant carries state sales tax, county sales tax, city sales tax and, in many cities, a local hospitality tax on prepared food. In Little Rock those four layers combine to 10.625%. In Fayetteville prepared food reaches 11.75%. The state portion is the same everywhere. The rest is local, which is why two restaurants an hour apart charge different amounts.
How does the Arkansas prepared food rate stack up?
Start with the state rate, then add your county, then your city, then any local hospitality tax on prepared food. Little Rock is the clearest worked example. State sales tax is 6.5%. Pulaski County adds 1%. The City of Little Rock adds 1.125%. The hospitality tax, sometimes called the advertising and promotion tax or A and P tax, adds 2% on prepared food. Together that is 10.625% on a plate of food.
Fayetteville arrives at a different number by a different route. Its combined sales tax base is 9.75%, and the hotel, motel and restaurant tax adds 2% on prepared food, reaching 11.75%.
Neither figure is guessable from the other. If someone quotes you a single statewide restaurant tax rate for Arkansas, they are wrong.
Did the 2026 grocery tax cut lower restaurant tax?
No. The state reduced food tax rate went to zero on 1 January 2026, and that rate applies to groceries, not to prepared food sold by a restaurant. Restaurant meals continue to be taxed at the ordinary combined rate plus any local hospitality tax.
This causes real friction at the counter, because the change was widely reported and guests reasonably expected it to reach their restaurant check. Give your staff a one sentence answer and put it in your training notes.
What counts as prepared food?
In broad terms, food sold in a heated state, food where two or more ingredients are combined by the seller, and food sold with eating utensils provided by the seller. The precise definition matters because it decides which tax group an item belongs in.
This bites hardest on restaurants with a retail side. A bakery selling a slice of cake to eat in and a boxed loaf to take home may be looking at two different tax treatments on the same counter. A brewery selling pints and also four packs to go is in the same position. Those items need separate tax groups in the POS, keyed correctly at the button level, or the difference quietly accumulates.
6.5% state, 1% Pulaski County, 1.125% city, 2% hospitality tax.
What does this mean for how the POS is configured?
Three things. Your prepared food group has to carry the full local stack for your specific city, not a state default. Any retail or grocery style items need their own group. And your reporting has to be able to separate them, because the hospitality tax is usually remitted to the city while sales tax goes to the state.
Owners are usually surprised by that last part. Two taxes on one ticket can be owed to two different authorities on two different returns. If your POS cannot produce that split cleanly, your bookkeeper rebuilds it by hand every month.
Questions restaurant owners ask
What is the restaurant sales tax rate in Little Rock?
Prepared food in Little Rock is taxed at a combined 10.625%. The stack is 6.5% state, 1% Pulaski County, 1.125% city, and 2% hospitality tax on prepared food. Mixed drinks are taxed under a different and much higher stack, because the hospitality tax does not apply to them.
Why is Fayetteville higher than Little Rock on food?
Because the local layers differ. Fayetteville's combined sales tax base is higher, and its hotel, motel and restaurant tax adds 2% on prepared food, reaching 11.75%. The state portion is identical in both cities. Everything above it is set locally.
Is the hospitality tax remitted to the state?
Usually not. Local hospitality and A and P taxes are generally remitted to the city or its advertising and promotion commission, separately from state and local sales tax filed with Arkansas DFA. Confirm the filing path for your city, because it determines what reporting you need out of your POS.
Do delivery and takeout change the rate?
Prepared food is generally taxed the same whether the guest eats in or takes it away, but delivery fees, service charges and third party marketplace arrangements can each be treated differently. If a meaningful share of your revenue is delivery, have your accountant confirm the treatment before you set the tax groups.
Vendor pricing and tax rates change without notice. Confirm current figures with the vendor, the city or your accountant before you rely on them. Not tax, legal or accounting advice.
Every number on this page traces to a primary source
- Little Rock combined rates on prepared food and mixed drinkslittlerock.gov / tax information
- Arkansas state sales and use tax rate and mixed drink tax ratesdfa.arkansas.gov / sales use tax
- Fayetteville HMR and supplemental beverage tax rates and exclusionsfayetteville-ar.gov / Sales Tax
- Arkansas state sales and use tax ratedfa.arkansas.gov / sales use tax