Annual sales tax holiday starts Friday
The state’s annual “sales tax holiday” is upon us again.
Starting Friday, Texas residents can enjoy three consecutive days of sales tax-free shopping on a wide spectrum of items — including most back-to-school supplies for elementary and secondary school students.
The tax holiday, which runs through Sunday, was expanded in 2009 to include school supplies priced under $100, including some backpacks. Consumers won’t have to pay state, local and use taxes on exempt items, which include cowboy boots and bow ties.
Allen Spelce, spokesman for the Texas comptroller’s office, said the holiday — in its 12th year — has saved Texans about $505 million in taxes since its inception. This year it’s expected taxpayers will save roughly $59.3 million, he said. Retailers, meanwhile, traditionally look forward to the event because it brings more customers into stores.
As in previous years, the law exempts from taxes most clothing and footwear priced under $100, which saves shoppers about $8 on every $100 spent. Backpacks under $100 to be used by elementary and secondary students are also exempt — including wheeled backpacks as long as they can also be worn on the back.
The exemption does not include items that can be “reasonably defined as luggage, briefcases, athletic/duffel/gym bags, computer bags, purses or framed backpacks,” according to the comptroller’s office. Up to 10 backpacks can be purchased tax-free at one time without providing an exemption certificate to the seller.
Just about every item an elementary or secondary school student could conceivably find a use for — binders, crayons, glue sticks, graph paper, lunch boxes, protractors, etc. — is tax-exempt during the holiday.
The comptroller’s office says no exemption certificate is required unless the purchaser is buying the supplies under a business account. A business account includes purchases made using a business credit card or check rather than a personal credit card or check; purchases being billed under a business account maintained at the retailer; and purchases made using a business membership at a membership-based retailer, such as Sam’s Club.
The comptroller’s office is warning retailers that sell nonexempt items not to advertise or otherwise promise that they’ll pay customers’ sales tax. Plus, retailers are legally prohibited from advertising that they won’t collect sales tax on nonexempt items, though retailers may advertise that the tax is included in the sales price of nonexempt items, according to the comptroller’s office.
In addition to school supplies, a wide range of essential consumer goods is covered by the exemption. And while it’s understandable why some items aren’t covered under the exemption — jewelry and roller blades, for instance — in other cases, the logic behind exempt versus nonexempt isn’t so clear. For example, the list of exempted articles includes many types of shoes, but not shoelaces.
Additionally, bathing suits are exempt but not bathing caps; baseball hats and jerseys are exempt but not baseball pants; bowling shirts are exempt but not bowling shoes; work clothes are exempt but not hard hats; hunting vests are exempt but not waders; and raincoats and ponchos are exempt but not umbrellas, and so on.
Spelce chuckled when asked about the apparent hair-splitting, admitting that some radio talk shows “were having a good time with it.”
“We get this question a lot,” he said. “It’s set by the Legislature. We really just essentially administer the program. They give us the rules and we enforce it.”
