Defining a Sales Tax Holiday
Tax-free holidays (sometimes referred to as "sales tax holidays") are great opportunities for shoppers to purchase designated items such as clothing, school supplies, energy-efficient products and disaster preparedness necessities free from sales tax. Each state that participates in tax-free holidays has different rules and exclusions. Below are states that have tax-free holidays August 6-8, 2021.
Iowa will hold its annual sales tax holiday on select clothing and footwear August 6-7, 2021. Allowing shoppers to purchase eligible clothing and footwear items tax-free. Businesses that are open on these dates and sell eligible items are required to participate in the sales tax holiday.
During the sales tax holiday, no sales tax will be collected on articles of clothing or footwear that sell for less than $100.00.
It’s important to note that this sales tax holiday is active only through August 7th. For more information about Iowa’s sales tax holiday on clothing and footwear, please refer to the Iowa Department of Revenue website.
Missouri will hold its annual back to school sales tax holiday August 6-8, 2021. During this time, the following items can be purchased tax-free:
- Clothing –$100 or less per item;
- School supplies – $50 or less per item;
- Computer software – $350 or less per item;
- Personal computers – $1,500 or less per item;
- Computer peripheral devices –$1,500 or less per item; and
- Graphing Calculators – $150 or less per item.
It is important to note that cities, counties and districts in Missouri can choose to not participate in this sales tax holiday. If one or all the local taxing jurisdictions do not participate in the sales tax holiday, the state's portion of the tax rate (4.225%) will remain exempt for the sale of qualifying sales tax holiday items.
For more information, review the Missouri Department of Revenue’s Back to School Sales Tax Holiday FAQs and information page.
New Mexico will hold a sales tax holiday (also known as the Gross Receipts Tax Holiday) on select clothing, school and art supplies, and computers August 6-8, 2021. New Mexico requires specified retailers to provide a deduction from gross receipts for retail sales of qualifying tangible personal property; in effect selling the items “tax free.”
The law limits the tax-holiday deduction to receipts of retailers from sales of the following types of items:
- Clothing or shoes sold for less than $100; however, accessories and special clothing or footwear primarily designed for athletic activity or protective use and not normally worn beyond the scope of the athletic activity or protective use remain taxable;
- Desktop, laptop, notebook or tablet computers sold for no more than $1,000, and any associated monitor, speaker or set of speakers, printers, keyboards, microphones or computer mice sold for no more than $500; and
- School supplies students normally use in a standard classroom for educational purposes for $30 or less per item. (The law specifically lists notebooks, paper, writing instruments, crayons, art supplies, rulers, bookbags, backpacks, handheld calculators, maps and globes as deductible during the tax holiday.)
For more information about this sales tax holiday, please visit the New Mexico Taxation and Revenue Department’s For Your Information page.
Ohio will hold a sales tax holiday for clothing and school supplies on August 6-8, 2021.
During the holiday, the following items are exempt from sales and use tax:
- Clothing (including, but not limited to footwear, hats, diapers, and uniforms) priced at $75 per item or less;
- School supplies (including, but not limited to binders, folders, highlighters and writing tablets) priced at $20 per item or less; and
- School instructional materials (including reference books, reference maps and globes, textbooks, and workbooks) priced at $20 per item or less.
It is important to note that items used in a trade or business are not exempt under this sales tax holiday. The sales tax holiday is set by law and vendors are required to comply.
For more specific information, please refer to the Ohio Department of Taxation Sales Tax Holiday FAQ’s.
Oklahoma is set to hold its annual sales tax holiday on select clothing and footwear during August 6-8, 2021. Allowing shoppers to purchase eligible clothing and footwear items tax-free.
During the sales tax holiday any article of clothing or footwear less than $100 per item is tax exempt. This excludes any accessories, special clothing or footwear primarily designed for athletic activity or protective use that is not normally worn, except when used for athletic activity or protective use, as well as the rental of clothing or footwear.
Retailers that sell eligible items and are open for business on these dates are required to participate in the sales tax holiday.
For more information about Oklahoma’s sales tax holiday please refer to the Oklahoma Tax Commission Sales Tax Holiday page.
South Carolina will hold its annual sales tax holiday August 6-8, 2021. During the sales tax holiday, a variety of back-to-school essentials are exempt from the state's six percent sales tax rate and any additional local taxes. Unlike other sales tax holidays across the country, there are no price restrictions on eligible goods.
Items that are tax exempt during this sales tax holiday include:
- Clothing and accessories (including but not limited to hats, scarves, hosiery, and handbags);
- School supplies (including, but not limited to pens, pencils, paper, binders and notebooks);
- Computers, printers/printer supplies, and software;
- Select bed and bath items (including, but not limited to blankets, bed spreads and pillows).
It is important to note that if the item is eligible and the sale occurs during the holiday, online purchases are tax-free.
Please refer to South Carolina Revenue Ruling 19-4 for the complete list of tax-exempt items or visit the South Carolina Department of Revenue webpage for more information.
Texas is holding its annual sales tax holiday from August 6-8, 2021. During this time, consumers can purchase select clothing and footwear, school supplies and backpacks, with a purchase price of $100 or less per item, free of state and local sales tax.
This exemption includes backpacks with wheels and messenger bags. You can buy up to 10 backpacks tax-free at one time without giving an exemption certificate to the seller.
Additional charges by the seller such as delivery, shipping, handling and transportation are part of the item’s sale price.
For more information on this sales tax holiday, visit the Comptroller of Texas’ website.
Virginia will hold a combined sales tax holiday on select clothing, school supplies, footwear, hurricane and emergency preparedness items and Energy StarTM and WaterSenseTM products August 6-8, 2021.
During the sales tax holiday, the following types of products can be purchased without paying sales tax:
- Qualified school supplies sold for less than $20;
- Hurricane and emergency preparedness products (such as portable generators with a sales price of $1,000 or less per item, gas-powered chainsaws with a sales price of $350 or less per item, chainsaw accessories with a sales price of $60 or less per item and other specified hurricane preparedness items with a sales price of $60 or less per item);
- Qualified clothing and footwear sold for less than $100; and
- Qualifying Energy StarTM or WaterSenseTM products purchased for noncommercial home or personal use with a sales price of $2,500 or less per item.
For more information, visit the Virginia Taxation and Revenue Department for the 2021 Sales Tax Holiday Guidelines.