Sales Tax Holiday Weekends Coming Up in Arkansas and Texas
Arkansas schools will begin in about two weeks, followed by Texas schools the week after. That means parents will be hitting the stores buying school supplies and new clothes for their children to begin the new school year.
Both the states of Arkansas and Texas have what are called sales tax holiday weekends, where sales taxes are excluded on a number of items that are commonly purchased for back to school items.
Arkansas will hold its sales tax holiday this weekend. It begins at midnight early Saturday morning and continues until midnight Sunday night.
According to the Arkansas Department of Finance and Administration shoppers will have the opportunity to purchase certain school supplies, school art supplies, school instructional materials, and clothing free of state and local sales or use tax.
All retailers are required to participate and may not charge tax on items that are legally tax-exempt during the Sales Tax Holiday.
The Texas Sales Tax Holiday will run the following weekend, Friday August 7 through Sunday August 9. According to the Texas Comptroller's Office, the law exempts most clothing, footwear, school supplies and backpacks priced under $100 from sales and use taxes, which could save shoppers about $8 on every $100 they spend.
Subject to the criteria explained below, all sales of qualifying items made during the holiday period qualify for the exemption, including items sold online, or by telephone or mail. Lay-away plans can be used again this year to take advantage of the sales tax holiday.
The dates for the sales tax holiday are set by the Legislature.
Here are some more specifics the comptroller's office has on clothing and footwear as well as school supplies:
Retailers are not required to collect state and local sales or use tax on most footwear and clothing that are sold for less than $100 during the holiday. Exemption certificates are not required. The exemption applies to each eligible item that sells for less than $100, regardless of how many items are sold on the same invoice to a customer. For example, if a customer purchases two shirts for $80 each, then both items qualify for the exemption, even though the customer's total purchase price ($160) exceeds $99.99.
The exemption does not apply to the first $99.99 of an otherwise eligible item that sells for more than $99.99. For example, if a customer purchases a pair of pants that costs $110, then sales tax is due on the entire $110.
The exemption also does not apply to sales of special clothing or footwear that the manufacturer primarily designed for athletic activity or protective use and that is not normally worn except when used for the athletic activity or protective use for which the manufacturer designed the article. For example, golf cleats and football pads are primarily designed for athletic activity or protective use and are not normally worn except for those purposes; they do not qualify for the exemption. Tennis shoes, jogging suits and swimsuits, however, are commonly worn for purposes other than athletic activity and thus qualify for the exemption.
The sales tax holiday exemption does not extend to rental of clothing or footwear; nor does it apply to alteration (including embroidery) or cleaning services performed on clothes and shoes. Additionally, tax is due on sales of accessories, including jewelry, handbags, purses, briefcases, luggage, umbrellas, wallets, watches and similar items.
Texas families also get a sales tax break on most school supplies priced at less than $100 purchased for use by a student in an elementary or secondary school.
Backpacks priced under $100 sold for use by elementary and secondary students are exempt during the sales tax holiday. A backpack is a pack with straps one wears on the back. The exemption includes backpacks with wheels, provided they can also be worn on the back like a traditional backpack, and messenger bags.
The exemption does not include items that are reasonably defined as luggage, briefcases, athletic/duffle/gym bags, computer bags, purses or framed backpacks. Ten or fewer backpacks can be purchased tax-free at one time without providing an exemption certificate to the seller.