Sales Tax Takes A Holiday

Each year, several states offer a “holiday” from sales tax in order to increase spending before school begins. Here are some sales tax holidays that I’m aware of.

As the mother of three children, I can appreciate this nod towards back to school spending. And according to the National Retail Federation, families with school-age children are expected to spend $563.49 in 2007 for school-related gear – or $18.4 billion nationwide. Clothing and accessories comprise the biggest chunk of that spending. With average state sales tax rates of between 4 and 7%, that can really add up.

Since most parents start shopping for school 3-4 weeks before school begins (around Labor Day in most, but not all, states), it’s no wonder that most of the sales tax holidays begin in the first week of August.

If you know of additional state sales tax holidays or other back to school tax incentives, let us know – feel free to post in the comments!

Alabama
When? August 3, 4 and 5
What’s exempt? Clothing up to $100, computers up to $750, school supplies up to $50 and books up to $30

Connecticut
When? August 19-25
What’s exempt? Clothing up to $300

District of Columbia
When? August 4-12
What’s exempt? Clothing up to $100 and school supplies up to $100

Florida
When? August 4-13
What’s exempt? Clothing up to $50, school supplies up to $10

Georgia
When? August 2, 3, 4 and 5
What’s exempt? Clothing up to $100, school supplies up to $20, computers up to $1,500 and the ambiguously named “energy efficient products” of up to $1,500

Iowa
When? August 3 and 4
What’s exempt? Clothing up to $100

Louisiana
When? August 3 and 4
What’s exempt? Most individual items of tangible personal property for non-business use up to $2,500

Missouri
When? August 3, 4 and 5
What’s exempt? Clothing up to $100, computers up to $3500 and school supplies up to $50

New Mexico
When? August 3, 4 and 5
What’s exempt? Clothing up to $100, computers up to $1,000 and school supplies up to $15

North Carolina
When? August 3, 4 and 5
What’s exempt? Clothing, footwear, and school supplies up to $100, sports and recreation equipment up to $50 per item, computers up to $3,500 per item, and computer supplies up to $250 per item

Oklahoma
When? August 3, 4 and 5
What’s exempt? clothing up to $100

South Carolina
When? August 3, 4 and 5
What’s exempt? clothing, school supplies, computers

Tennessee
When? August 3, 4 and 5
What’s exempt? clothing up to $100, school supplies up to $100 and computers up to $1,500

Texas
When? August 17, 18, and 19
What’s exempt? Most clothing and footwear priced under $100, backpacks under $100 used by elementary and secondary students

Virginia
When? August 3, 4 and 5
What’s exempt? Clothing up to $100, school supplies up to $20

Sadly, my own state of Pennsylvania is not participating. This is likely because clothing is already exempt from taxation in Pennsylvania – but c’mon, Governor Rendell, can’t we get a break on school supplies?

There is no state sales tax in Alaska, Delaware, Montana, New Hampshire, and Oregon.

** Disclaimer: This information was culled from several sources. If you have any questions about your state’s sales tax holiday, please contact your local Revenue Department.

Kelly Phillips Erb

Kelly Phillips Erb is a tax attorney, tax writer, and podcaster.

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