Holiday time already? In many states, sales tax holidays have been in full swing this year and will continue for months to come. Some of the deals are long-standing; others have been trotted out by lawmakers claiming to want to help constituents weather inflation.
These holidays are limited times (frequently weekends) where a state allows sales tax to be eliminated or reduced on categories of consumer products. Eligible purchases are often limited to a dollar amount.
What’s on sale?
Back-to-school remains the predominant theme of sales tax holidays in many states in August, including Iowa (Aug. 5-6) and Missouri, New Mexico, Ohio, Oklahoma, South Carolina, Texas and Virginia (all Aug. 5-7).
Other states with back-to-school holidays include West Virginia (Aug. 5-8); Illinois (Aug. 5-14); Arkansas (Aug. 6-7); Maryland (Aug. 14-20); Connecticut (Aug. 21-27); and New Jersey (Aug. 27-Sept. 5).
Discounted items include clothing and various school and art supplies, often including backpacks and computers and some peripherals and other electronics. Check with the individual states to determine purchase limits and other restrictions.
Other categories often qualify for holidays. During that same time in early August, for instance, Virginia will also offer a sales tax break on Energy Star products (up to $2,500), hurricane preparedness items (up to $60) and generators (up to $1,000).
Among other holidays:
- Mississippi will have a holiday Aug. 26-28 on retail sales of firearms, ammunition and hunting supplies (the latter means tangible personal property used for hunting, including archery equipment, firearm and archery cases, firearm and archery accessories, hearing protection, holsters, belts and slings). Tennessee also has a holiday on gun safes and safety devices that runs all the way to June 30, 2023.
- Tennessee will also have a sales tax holiday the entire month of August on food and food ingredients (not including alcoholic beverages, tobacco, candy, dietary supplements and prepared food).
- In Massachusetts, non-business sales at retail of single items of tangible personal property costing $2,500 or less are exempt from sales and use taxes, subject to certain exclusions, Aug. 13-14.
- Nevada will waive the sales tax on all purchases by members of the National Guard on Oct. 28-30.
Lots of sunshine
Florida probably leads all states concerning sales tax holidays. The Sunshine State’s full menu of holidays this year includes one for “Skilled Worker Tools” (Sept. 3-9) on tools used by skilled trade workers: certain hand and power tools, work boots, safety equipment, shop lights, toolboxes and belts, plumbing and electrical equipment and industry textbooks. Children’s books have a sales tax holiday through Aug. 14.
Florida also has an Energy Star Sales Tax Exemption through June 30, 2023, on such appliances as refrigerators, freezers, washers and dryers; a Home Hardening Sales Tax Exemption through June 30, 2024, on such items as impact-resistant doors, windows and garage doors; and a holiday on children’s diapers and clothing through June 30, 2023.
Bear these holidays in mind as you sell into these states.
If you need help understanding your sales tax obligations and whether you should be collecting sales tax, get in touch. TaxConnex has experts to help answer these questions and to help you establish an ongoing process to ensure you remain compliant – even with the frequently changing rules of sales and use tax.