Sales tax holidays, sometimes referred to as Tax-free holidays are great opportunities for shoppers to purchase items tax-free, such as clothing, school supplies, shoes, and other savings. You don’t have to be a resident of one of these states to take advantage of their tax-free weekends, either.
A sales tax holiday is a limited period of time during which otherwise taxable products are exempt from sales tax. Approximately 17 states provide sales tax holidays each year; in most, the temporary sales tax exemption applies to specific products only, such as school supplies or energy-efficient appliances.
Why States have sales tax holidays?
States have sales tax holidays (aka, tax-free periods) for several reasons. They tend to be popular with consumers because they help them save money. Although they can complicate tax compliance, business owners usually like them because they bring people through the door. They can also encourage purchases of certain items, like emergency preparedness supplies.
Tax-free periods follow a predictable cadence in most states because they’re annual, meaning they’ll take place every year unless specifically eliminated — which does sometimes happen. Thus, Alabama’s severe weather preparedness holiday always takes place during the last full weekend of February, and Iowa’s clothing and footwear holiday always starts the first Friday in August.
Find your state and mark your calendars for tax free shopping (and selling)!
Alabama Sales Tax Holidays 2021
February 26-28, 2021 – Alabama Severe Weather Preparedness Sales Tax Holiday
Severe weather preparedness items costing $60 or less are not taxable during the sales tax holiday. Examples include batteries (including cell phones and chargers), duct tape, a self-powered self-contained first-aid kit, non-electric can opener.
Two exceptions are portable generators and power cords used to provide light or communications or preserve food in the event of a power outage – these items are tax-exempt during the holiday as long as they cost $1,000 or less.
July 16-19, 2021 – Alabama Back to School Sales Tax Holiday.
Clothing with a sales price of $100 or less per item is not taxable during the sales tax holiday; the holiday excludes clothing items considered accessories or protective/recreational equipment such as swimwear.
Single purchases of computers, computer software, and school computer equipment costing less than $750 are not taxable.
Noncommercial purchases of school supplies, school art supplies, and school instructional materials with a sales price of $50 or less per item are not taxable.
Noncommercial book purchases with a sales price of $30 or less per book are not taxable.
Most clothing and footwear that costs less than $100 per item is not taxable during the holiday; however the sales tax holiday excludes athletic or protective clothing, jewelry, handbags, luggage, umbrellas, wallets, watches and “similar items.”
Energy Star™ products including air conditioners, washers and dryers, furnaces, heat pumps, standard-size refrigerators, compact fluorescent light bulbs (CFL), light-emitting diode (LED) light bulbs, dehumidifiers, programmable thermostats, and solar water heaters are not taxable.
Qualifying apparel and footwear $100 or less, per item, are exempt from the state sales tax. The first $40 of a backpack or bookbag purchase is also tax-free. Accessory items, except for backpacks, are not included.
Mississippi Sales Tax Holidays 2021
July 30-July 31, 2021 – Mississippi Back to School Sales Tax Holiday
Clothing or footwear with a sales price of under $100 per item are not taxable; excludes accessories, rentals, skis, swim fins or skates.
August 27-August 29, 2021 – Mississippi Firearms and Ammunition Sales (2nd Amendment) Tax Holiday
Firearms, ammunition and hunting supplies, including archery equipment are non-taxable.
Noncommercial purchases of clothing with a taxable value of $100 or less per item are not taxable; this excludes accessories.
School supplies up to $50 per purchase are not taxable.
Computer software with a taxable value of $350 or less is not taxable.
Personal computers and computer peripherals up to $1500 are not taxable.
Graphing calculators with a taxable value of $150 or less are not taxable.
Localities may opt-out of the Missouri Back to School Sales Tax Holiday. If less than 2% of a Missouri retailer’s merchandise qualifies for the sales tax holiday, then the retailer must offer a tax refund in lieu of a tax holiday.
Among the merchandise that can be sold tax-free this weekend are clothing and shoes priced at less than $100 per unit, computers priced under $1,000 and related computer hardware priced under $500. School supplies under $30 per unit for use in standard, general-education classrooms also qualify. Retailers are not required to participate in New Mexico sales tax holidays.
Portable generators used to provide light or communications or to preserve perishable food in the event of a power outage, up to $3,000 per item are not taxable.
Storm protection devices specifically rated and marketed to protect windows with a sales price of less than $300 are not taxable.
Emergency or rescue ladders with a sales price of less than $300 are not taxable.
Reusable or artificial ice, portable, self-powered light sources, gasoline or diesel fuel containers, batteries (excluding automobile or boat batteries), non-electric coolers or ice chests for food storage, tarpaulins or other flexible waterproof sheeting, a ground anchor system or tie-down kit, mobile telephone batteries or battery chargers, portable self-powered radios (including two-way radios or weatherband radios), non-electric can openers with a sales price of less than $75 are not taxable.
Fire extinguishers,smoke detectors, carbon monoxide detectors with a sales price of less than $75 are not taxable
Hatchets or axes with a sales price of less than $75 are not taxable.
Self-contained first aid kits with a sales price of less than $75 are not taxable.
Energy Star air conditioners with a sales price of $6,000 or less are not taxable.
Energy Star refrigerators, clothes washers, ceiling fans, dehumidifiers, dishwashers, incandescent or fluorescent light bulbs, and programmable thermostats with a sales price of $2,000 or less are not taxable.
Water efficient products: any product that displays a WaterSense.