As students head into the home stretch of summer vacation, shoppers in 17 states, including Arkansas, can expect sales tax breaks on the purchase of a variety of school-related gear. Arkansas’ sales tax holiday falls on Saturday and Sunday.
The tax holiday offers shoppers opportunities to purchase school supplies, certain clothing and instructional supplies without paying a sales and use tax on the items. Arkansas took the plunge into unfamiliar territory last year with its first-ever sales tax holiday geared for back-to-school shoppers. The state Department of Finance and Administration estimated the break on sales taxes cost state treasury $2.1 million in revenue.
Buying school gear could come with some tax savings, if you’re in one of the states offering temporary tax breaks on back-to-school purchases, but you must shop on the right dates and know the rules for each state.
Our tax holiday was established by Act 757 of 2011, which set aside the first weekend in August each year.
Georgia discontinued its holiday in 2010, but revived it this year. It’s the only state to enact a new holiday for 2012.
Seventeen states have scheduled sales tax holidays on qualifying purchases during this year’s back-to-school shopping season. The holidays are becoming more popular, with only nine states offering the tax breaks a decade ago.
Mississippi kicked off the back-to-school tax holiday with a two-day holiday that began July 27. Most states are offering the tax break holidays for Friday through Sunday. Four hold them in mid- to late August.
Every state contiguous to Arkansas — Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas — has a tax holiday for school supplies.
Rules vary from state to state, but generally the breaks are limited to items such as clothing and school supplies. However, all states limit the amount that’s exempt from the sales tax.
Some limit the exemption to clothes and shoes, while 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 per item for school supplies in Florida to $3,500 for computers in Missouri and North Carolina.
The following are exempt in Arkansas: Sales of clothing priced at $100 or less per item; clothing accessories or equipment under $50; school art supplies, school instructional materials and school supplies commonly used in the course of study. We read the fine print in the Arkansas law, but couldn’t find an exemption for computers or prom dresses.
In Connecticut, the exemption on clothing and footwear is $300 per item. Footwear is covered in Mississippi, but not accessories, including rentals, skis, swim fins or skates.
Oklahoma also bans the rental of clothing and footwear, the sale of special clothing or footwear primarily designed for athletic or protective use, or the sale of accessories, under the exemption.
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, including energy-efficient appliances.
Louisiana remains the only state that offers a state tax holiday for noncommercial purchases of firearms, ammunition, and hunting supplies are exempt from sales taxes. However, animals purchased for the use of hunting are not exempt.
We are not too sure about hunting dogs being excluded from the exemption. That section of the law was written in Cajun.
• • •
Larry Fugate is a veteran journalist and former editor of The Pine Bluff Commercial. He can be reached by e-mail at email@example.com or at (870) 329-7010.