Back-to-school season is one of those times of year that many small retail business owners eagerly look forward to. Families in the U.S. collectively spend tens of billions of dollars in August outfitting their school-age kids for the coming academic year, an average this year of almost $700 per family according to one survey. Some states and municipalities try to give parents a bit of a financial break, while also helping local businesses, by declaring an annual sales tax holiday on certain school-related items. In the state of Connecticut last week, for example, consumers got a sales tax exemption when purchasing clothes and shoes valued at up to $300.
Just because back-to-school time is over, however, doesn’t mean that state sales tax holidays are a thing of the past. Although academic supplies are one of the most popular categories of goods to be granted a seasonal sales tax exemption, various state and local governments have enacted similar exemptions for a variety of consumer purchases at other times of year. Anyone responsible for sales tax reporting and remittance for a small business should be aware of any sales tax holidays that have been enacted in the jurisdictions in which they transact business.
In the “Sportsman’s Paradise” of Louisiana, for example, the approach of fall hunting season means that purchasers of firearms, ammunition and other hunting supplies will get a sales tax break Sept. 7-9. This is the fourth year that the state of Louisiana has enacted a fall moratorium on applying sales tax to hunting items. Similarly, South Carolina holds a two-day tax holiday on guns and rifles just after Thanksgiving on November 23-24, the fifth year that the state has done so.
Other state tax holidays are aimed at giving a break to residents who are buying appliances to keep themselves comfortable, and at encouraging efficient use of energy. In early October, with the approach of cooler weather, Virginia and Georgia have tax holidays on the purchase of energy-efficient (and in the case of Georgia, water-efficient) appliances. North Carolina has a similar tax break on “Energy Star”-rated products in early November. Maryland also has an Energy Star tax holiday in February, and the state of Missouri follows suit in April. Texas has a tax moratorium in late May – as hot summer weather approaches in the Lone Star State – on air conditioners and Energy Star products.
In three other states, legislators have enacted a sales tax holiday for another weather-related reason: hurricanes. Virginia and Louisiana don’t collect sales tax on the sale of generators and other hurricane-preparedness items for a period in late May. Alabama has a similar tax break that’s available July 6-8.
For accurate and timely preparation of sales tax, payroll tax and income tax returns, along with professional bookkeeping and expert business consulting services, small business owners can rely on PADGETT BUSINESS SERVICES®. We have 400 offices across the United States and Canada.
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