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A Holiday from Tax Eases Back-to-school Spending, CCH Says
Updated to reflect recent passage of holiday in Massachusetts
(RIVERWOODS, ILL., July 21, 2005) – Call them tax breaks for families with school-age children or sales boosters for retail businesses, sales tax holidays have become a fixture of the back-to-school season in a number of states, according to CCH Tax and Accounting (CCH), a leading provider of tax and accounting information and software (tax.cchgroup.com).
Eleven states and the District of Columbia have sales and use tax holidays this summer, during which back-to-school items such as clothing, footwear, school supplies and computers may be exempt. A holiday has been proposed, but not yet enacted, in Michigan. Also, Maryland and Tennessee have enacted holidays for 2006, CCH noted. Here are the jurisdictions holding holidays this year, along with the dates of the holidays and the basics of what is exempt:
Connecticut: Clothing and footwear sold for less than $300 are exempt from sales and use tax from August 21-27. The holiday exemption replaces the regular exemption for clothing and footwear costing less than $50, which remains in effect for all other periods. It does not apply to athletic or protective clothing and footwear, jewelry, handbags, luggage, umbrellas, wallets and watches.
District of Columbia: Sales of school supplies, clothing, accessory items and shoes for less than $100 are exempt from sales tax from August 6-14.
Florida: Books, clothing, footwear and certain accessories with a sales price of $50 or less per item, and school supplies with a sales price of $10 or less per item, are exempt from Florida sales and use tax from July 23-31. The exemption does not apply to sales within a theme park, entertainment complex, public lodging establishment or airport.
Georgia: From July 28-31, Georgia sales and use tax does not apply to certain school supplies (up to $20 per item); clothing and footwear (priced at $100 or less per article); and computers and computer-related accessories for noncommercial use (for a single purchase of $1,500 or less).
Iowa: The state’s sales tax holiday on select clothing and footwear runs August 5-6. During the holiday, no sales tax, including school and local option sales taxes, will be collected on clothing or footwear that has a selling price of less than $100 per item. Certain accessories are excluded from the tax holiday.
Massachusetts: Recently enacted a sales tax holiday that will be held on August 13 and 14, during which most purchases made by individuals for personal use will not be subject to tax. The sales tax holiday will not apply to sales of telecommunications, tobacco products, gas, steam, electricity, motor vehicles, motorboats, meals, or any single item with a price in excess of $2,500
Missouri: From August 5-7, retail sales of the following are exempt from state sales tax: Clothing and footwear (excluding certain accessories) costing $100 or less; school supplies costing $50 or less; computer software with a taxable value of $350 or less; and personal computers and computer peripheral devices sold for $3,500 or less. The holiday does not apply to sales within the state fairgrounds.
New Mexico: Customers may buy the following items free of tax from August 5-7: Clothing or shoes sold for less than $100 (excluding items primarily for athletic or protective use); computers (but not handheld computers) sold for no more than $1,000, and any associated monitor, speakers, printer or related items sold for no more than $500; notebooks, paper, writing instruments, crayons, art supplies, paper clips, staples, staplers, scissors and rulers priced under $15; and bookbags, backpacks, handheld calculators, maps and globes priced under $100.
New York: Sales of clothing and footwear, or items used to make or repair clothing, costing less than $110 per item are exempt from state tax and certain local taxes from August 30-September 5. The regular sales and use tax exemption for clothing and footwear costing less than $110 is currently suspended through April 1, 2006.
North Carolina: The sales and use tax holiday runs from August 5-7. Exempt items are clothing, footwear and school supplies with a sales price of $100 or less; sports and recreation equipment with a sales price of $50 or less; and computers with a sales price of $3,500 or less. Clothing accessories, protective equipment, furniture and rentals are not exempt during the holiday.
South Carolina: From August 5-7, clothing, clothing accessories, footwear, school supplies, computers, printers, printer supplies, computer software and linens for the bed and bath are exempt from state and local sales tax. Certain items, including, but not limited to, jewelry, cosmetics and furniture, are not exempt during the holiday.
Texas: From August 5-7, sales of most clothing and footwear priced at less than $100 are exempt from state and local sales taxes. Clothing and footwear used primarily for athletic activities or for protective wear are ineligible for the exemption. Accessories, such as watches and jewelry, also are excluded from the holiday.
About CCH Tax and Accounting
CCH Tax and Accounting (www.tax.cchgroup.com), based in Riverwoods, Ill., is the nation’s premier provider of tax, audit, and accounting information, software and services. It has served tax, accounting and business professionals and their clients since 1913. Among its market leading products are The ProSystem fx® Office, CCH® Tax Research NetWork™, Accounting Research Manager™ and the U.S. Master Tax Guide®. CCH Tax and Accounting is a Wolters Kluwer company.
Wolters Kluwer is a leading multinational publisher and information services company. Wolters Kluwer has annual revenues (2004) of €3.3 billion, employs approximately 18,400 people worldwide and maintains operations across Europe, North America and Asia Pacific. Wolters Kluwer is headquartered in Amsterdam, the Netherlands (www.wolterskluwer.com). Its depositary receipts of shares are quoted on the Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices.
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