CCH Updates Back-to-school State Tax Holidays for 2011

Riverwoods, IL - 28 July 2011

New State Joins List, While Others Phase Out Tax Holidays.

As the days draw closer to another school year, shoppers in 16 states can expect sales tax breaks on the purchase of various school-related goods in upcoming weeks, according to CCH, a Wolters Kluwer business and a leading global provider of tax, accounting and audit information, software and services (CCHGroup.com). States holding these “tax holidays” allow back-to-school items such as clothing, footwear, school supplies, computers and certain other products to be purchased free of state sales tax. Local sales taxes may continue to be imposed in some places, however.

“Although many states continue to struggle with enormous budget deficits, they’re often unwilling to eliminate tax holidays,” said Carol Kokinis-Graves, JD, CCH Senior State Tax Analyst. “Some states decided not to re-enact tax holidays, but others are staying the course.”

Arkansas was the only state to enact a new back-to-school tax holiday for 2011. Illinois chose not to continue its back-to-school tax holiday from 2010 and both Georgia and Vermont haven’t held back-to-school tax holidays since 2009.

2011 Back-to-school Tax Holidays

Sales tax holidays timed for back-to-school shopping begin as early as July 29. While some limit the exemption to clothes and shoes, others extend exemptions to a wide range of personal items. All place dollar limits on the amount exempt from sales tax, from as little as $15 for school supplies in Florida to as much as $3,500 for computers and computer peripherals in Missouri.

Alabama: On Aug. 5-7, the following are exempt: clothing (not accessories or protective or recreational equipment) with a sales price of $100 or less per item; single purchases, with a sales price of $750 or less, of computers, computer software, school computer equipment; noncommercial purchases of school supplies, school art supplies and school instructional materials with a sales price of $50 or less per item; and noncommercial book purchases with a sales price of $30 or less per book.

Arkansas: On Aug. 6-7, the following are exempt: sales of clothing items under $100, clothing accessories or equipment under $50, school art supplies, school instructional materials and school supplies.

Connecticut: On Aug. 21-27, clothing and footwear costing less than $300 per item are exempt. Not included are accessories or athletic or protective clothing.

Florida: On Aug. 12-14, the following are exempt: clothing with a sales price of $75 or less per item and school supplies with a sales price of $15 or less per item. Certain restrictions apply.

Illinois: In 2010, the state held sales tax holidays for footwear and clothing with a sales price of less than $100 per item and for school supplies. However, the state has not enacted any sales tax holidays for 2011.

Iowa: On Aug. 5-6, clothing and footwear with a sales price of less than $100 per item are exempt. Does not include accessories, rentals, athletic or protective clothing.

Louisiana: On Aug. 5-6, the first $2,500 of the sales price of noncommercial purchases (not leases) of items of tangible personal property (not vehicles or meals). Does not apply to local taxes. (St. Charles Parish voted to waive its 5 percent local Louisiana sales tax during the same weekend as the 2011 Louisiana Annual Sales Tax Holiday; as a result, St. Charles Parish shoppers will save 9 percent on qualified purchases).

Maryland: On Aug. 14-20, clothing and footwear with a taxable price of $100 or less will be exempt. Accessories are not included.

Mississippi: On July 29-30, clothing or footwear (not accessories, rentals, or skis, swim fins or skates) with a sales price under $100 per item are exempt.

Missouri: On August 5-7, noncommercial purchases of clothing (but not accessories) with a taxable value of $100 or less per item; school supplies up to $50 per purchase; computer software with a taxable value of $350 or less; and computers and computer peripherals up to $3,500 are exempt. Localities may opt out. If less than two percent of a retailer's merchandise qualifies, the retailer must offer a refund of sales tax paid if the customer requests one, in lieu of the tax holiday.

New Mexico: On Aug. 5-7, footwear and clothing with a sales price of less than $100 per item; school supplies; computers with a sales price of $1,000 or less per item; and computer peripherals with a sales price of $500 or less per item are exempt. Retailers are not required to participate. Does not include accessories, athletic or protective clothing.

North Carolina: On August 5-7, clothing and school supplies with a sales price of $100 or less per item; school instructional materials with a sales price of $300 or less per item; sport/recreational equipment with a sales price of $50 or less per item; computers with a sales price of $3,500 or less; and computer supplies with a sales price of $250 or less per item are exempt. Does not include clothing accessories or protective equipment.

Oklahoma: On Aug. 5-7, items of clothing and footwear with a sales price of less than $100 are exempt. Does not include accessories, athletic or protective clothing or rentals.

South Carolina: On Aug, 5-7, clothing (but not rentals), clothing accessories, footwear, school supplies, computers, printers, printer supplies, computer software, bath wash clothes, bed linens, pillows, bath towels, shower curtains and bath rugs are exempt.

Tennessee: On Aug. 5-7, clothing (but not accessories), school supplies and school art supplies with a sales price of $100 or less per item; and computers with a sales price of $1,500 or less per item are exempt.

Texas: On Aug. 19-21, clothing and footwear and school backpacks with a sales price of less than $100 per item are exempt. Does not include accessories, athletic or protective clothing or rentals.

Virginia: On Aug. 5-7, clothing and footwear with a sales price of $100 or less per item and school supplies with a sales price of $20 or less per item are exempt.

Holidays for Other Purposes: Energy, Hurricanes and Firearms

In addition to holidays timed for back-to-school buying, a number of states have enacted tax holidays offered at various times throughout the year to promote other kinds of purchases.

Energy efficiency is the most common theme. Maryland, Missouri and Texas have already held energy-efficiency tax holidays this year. Virginia has scheduled its energy efficiency tax holiday from Oct. 7-10. North Carolina and West Virginia had energy-related sales tax holidays in 2010 but did not enact them for 2011.

Louisiana and Virginia continued to hold tax holidays for hurricane-preparedness supplies in the spring of this year.

Louisiana continues to have firearms-related tax holidays. Louisiana’s holiday covers noncommercial purchases of firearms, ammunition and a broad range of hunting supplies (but not the purchase of animals for the use of hunting); it is held each year on the first consecutive Friday through Sunday of September (in 2011, the holiday will be held on Sept. 2-4). South Carolina had provided an annual tax holiday in 2010 for sales of handguns, rifles and shotguns during what the legislature dubbed “Second Amendment Weekend” – the Friday and Saturday following Thanksgiving but discontinued its firearms-related tax holiday for 2011.

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