Texas shoppers get a break from state and local sales taxes on August 21 22 and 23 - the states annual tax holiday. Lay-away plans can be used again this year to take advantage of the sales tax holiday.
As in previous years the law exempts most clothing and footwear priced under $100 from sales and use taxes which could save shoppers about $8 on every $100 they spend. Backpacks under $100 and used by elementary and secondary students are also exempt. A backpack is a pack with straps one wears on the back.
The exemption during the sales tax holiday 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.
School Supplies - New in 2009!
The 81st Texas Legislature recently passed HB 1801 (2009) expanding the list of items qualifying for exemption from Texas state and local sales and use taxes during the annual sales tax holiday in August. Effective this year in addition to clothes footwear and some backpacks 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.
The following is an all-inclusive list of qualifying school supplies (if priced less than $100):
1.Binders
2.Book bags
3.Calculators
4.Cellophane tape
5.Blackboard chalk
6.Compasses
7.Composition books
8.Crayons
9.Erasers
10.Folders; expandable pocket plastic and manila
11.Glue paste and paste sticks
12.Highlighters
13.Index cards
14.Index card boxes
15.Legal pads
16.Lunch boxes
17.Markers
18.Notebooks
19.Paper; loose leaf ruled notebook paper copy paper graph paper tracing paper manila paper colored paper poster board and construction paper
20.Pencil boxes and other school supply boxes
21.Pencil sharpeners
22.Pencils
23.Pens
24.Protractors
25.Rulers
26.Scissors
27.Writing tablets
No exemption certificate is required - with one exception. If the purchaser is buying the supplies under a business account the retailer must obtain an exemption certificate from the purchaser certifying that the items are purchased for use by an elementary or secondary school student. Under a business account" means the purchaser is using a business credit card or business check rather than a personal credit card or personal check; being billed under a business account maintained at the retailer; or is using a business membership at a retailer that is membership based.
List of Clothing Footwear and Backpacks and Their Exempton Status
TAX-FREE TAXED
•Baby clothes
•Backpacks for use by elementary and secondary students
•Belts with attached buckles
•Boots - cowboy hiking
•Caps/hats - baseball fishing golf knitted
•Coats and wraps
•Diapers - adult and baby
•Dresses
•Gloves (generally)
•Gym suits and uniforms
•Hooded shirts and hooded sweatshirts
•Hosiery
•Jackets
•Jeans
•Jerseys - baseball and football
•Jogging apparel
•Neckwear and ties
•Pajamas
•Pants and trousers
•Raincoats and ponchos
•Robes
•Shirts
•Shoes - sandals slippers sneakers tennis walking
•Socks (including athletic)
•Shorts
•Suits slacks and jackets
•Sweatshirts
•Sweat suits
•Sweaters
•Swimsuits
•Underclothes
•Work clothes and uniforms
•Accessories (generally) - barrettes elastic ponytail holders wallets watches
•Backpacks - unless for use by elementary and secondary students
•Baseball cleats and pants
•Belt buckles (without belt)
•Boots - climbing fishing rubber work boots ski waders
•Buttons and zippers
•Cloth and lace knitting yarns and other fabrics
•Dry cleaning services
•Football pants
•Golf gloves
•Handbags and purses
•Handkerchiefs
•Hard hats
•Helmets - bike baseball football hockey motorcycle sports
•Ice skates
•Jewelry
•Laundering services
•Leather goods - except belts with buckles and wearing apparel
•Pads - football hockey soccer elbow knee shoulder
•Personal flotation devices
•Rented clothing (including uniforms formal wear and costumes)
•Roller blades and skates
•Safety clothing glasses
•Shoes - bicycle (cleated) bowling golf
A word of caution: If you sell items that do not qualify for the exemption you may not advertise or promise that you will pay your customers sales tax. Additionally you are prohibited from advertising that you will not collect sales tax on items that do not qualify. You may advertise that tax is included in the sales price of the taxable items that you sell however.
For information on how to report tax on these sales please visit Reporting Sales Tax on Tax-Free Items or call us toll free at (800) 252-5555.
Texas shoppers get a break from state and local sales taxes on August 21 22 and 23 - the states annual tax holiday. Lay-away plans can be used again this year to take advantage of the sales tax holiday.
As in previous years the law exempts most clothing and footwear priced under $100 from sales and use taxes which could save shoppers about $8 on every $100 they spend. Backpacks under $100 and used by elementary and secondary students are also exempt. A backpack is a pack with straps one wears on the back.
The exemption during the sales tax holiday 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.
School Supplies - New in 2009!
The 81st Texas Legislature recently passed HB 1801 (2009) expanding the list of items qualifying for exemption from Texas state and local sales and use taxes during the annual sales tax holiday in August. Effective this year in addition to clothes footwear and some backpacks 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.
The following is an all-inclusive list of qualifying school supplies (if priced less than $100):
1.Binders
2.Book bags
3.Calculators
4.Cellophane tape
5.Blackboard chalk
6.Compasses
7.Composition books
8.Crayons
9.Erasers
10.Folders; expandable pocket plastic and manila
11.Glue paste and paste sticks
12.Highlighters
13.Index cards
14.Index card boxes
15.Legal pads
16.Lunch boxes
17.Markers
18.Notebooks
19.Paper; loose leaf ruled notebook paper copy paper graph paper tracing paper manila paper colored paper poster board and construction paper
20.Pencil boxes and other school supply boxes
21.Pencil sharpeners
22.Pencils
23.Pens
24.Protractors
25.Rulers
26.Scissors
27.Writing tablets
No exemption certificate is required - with one exception. If the purchaser is buying the supplies under a business account the retailer must obtain an exemption certificate from the purchaser certifying that the items are purchased for use by an elementary or secondary school student. Under a business account" means the purchaser is using a business credit card or business check rather than a personal credit card or personal check; being billed under a business account maintained at the retailer; or is using a business membership at a retailer that is membership based.
List of Clothing Footwear and Backpacks and Their Exempton Status
TAX-FREE TAXED
•Baby clothes
•Backpacks for use by elementary and secondary students
•Belts with attached buckles
•Boots - cowboy hiking
•Caps/hats - baseball fishing golf knitted
•Coats and wraps
•Diapers - adult and baby
•Dresses
•Gloves (generally)
•Gym suits and uniforms
•Hooded shirts and hooded sweatshirts
•Hosiery
•Jackets
•Jeans
•Jerseys - baseball and football
•Jogging apparel
•Neckwear and ties
•Pajamas
•Pants and trousers
•Raincoats and ponchos
•Robes
•Shirts
•Shoes - sandals slippers sneakers tennis walking
•Socks (including athletic)
•Shorts
•Suits slacks and jackets
•Sweatshirts
•Sweat suits
•Sweaters
•Swimsuits
•Underclothes
•Work clothes and uniforms
•Accessories (generally) - barrettes elastic ponytail holders wallets watches
•Backpacks - unless for use by elementary and secondary students
•Baseball cleats and pants
•Belt buckles (without belt)
•Boots - climbing fishing rubber work boots ski waders
•Buttons and zippers
•Cloth and lace knitting yarns and other fabrics
•Dry cleaning services
•Football pants
•Golf gloves
•Handbags and purses
•Handkerchiefs
•Hard hats
•Helmets - bike baseball football hockey motorcycle sports
•Ice skates
•Jewelry
•Laundering services
•Leather goods - except belts with buckles and wearing apparel
•Pads - football hockey soccer elbow knee shoulder
•Personal flotation devices
•Rented clothing (including uniforms formal wear and costumes)
•Roller blades and skates
•Safety clothing glasses
•Shoes - bicycle (cleated) bowling golf
A word of caution: If you sell items that do not qualify for the exemption you may not advertise or promise that you will pay your customers sales tax. Additionally you are prohibited from advertising that you will not collect sales tax on items that do not qualify. You may advertise that tax is included in the sales price of the taxable items that you sell however.
For information on how to report tax on these sales please visit Reporting Sales Tax on Tax-Free Items or call us toll free at (800) 252-5555.
