02 Aug 2011 Sales tax holiday Aug. 6-7
Shoppers throughout the 501 will have an opportunity to save money toward school supplies, thanks to a sales tax holiday this weekend.
Beginning at 12:01 a.m. (CST) on Saturday Aug. 6, and ending at 11:59 a.m. on Sunday, Aug. 7, the state will hold its sales tax holiday allowing shoppers the opportunity to purchase certain school supplies, school art supplies, school instructional materials and clothing free of state and local sales or use tax.
All retailers are required to participate and may not charge tax on items that are legally tax-exempt during the sales tax holiday.
Here are some common questions and answers from the state Department of Finance about the sales tax holiday:
What items qualify as exempt from sales tax?
Clothing and footwear if the sales price is less than $100 per item; clothing accessories and equipment if the sales price is less than $50 per item; school supplies; school art supplies; and school instructional materials.
Where can I find a list of items that are eligible?
http://www.dfa.arkansas.gov/offices/exciseTax/salesanduse/Documents/holidayItemized.pdf
Do I have a limit as to how many qualifying items I can purchase?
The holiday exemption for clothing is limited to single articles with a price of less than $100. Items priced $100 or more are subject to the full state and local sales tax. (Example: A customer purchases two (2) shirts at $50 each, a pair of jeans at $75, and a pair of shoes at $125. No state and local sales tax is due on the two shirts ($50 each for a total of $100) and the pair of jeans ($75) even though the total cost ($175) exceeds the $100 threshold. However, the state and local sales tax will be due on the full purchase price ($125) of the shoes since they exceed $100 threshold.)
Are store issued discounts coupons treated differently than manufacturer issued discount coupons?
Retailers may offer store discounts and store coupons to reduce the selling price of an eligible item in order to qualify for the holiday exemption. However, manufacturer’s discount coupons do not reduce the selling price of an item and cannot be used to determine the selling price of an item in order to qualify for the holiday exemption. A manufacturer’s rebate also does not reduce the selling price of an item and may not be used to qualify an item.
Can I purchase a computer tax exempt?
Computers, periphery equipment, nor software qualify for the exemption and therefore cannot be purchased tax exempt.
Does the sales tax exemption only apply to the state tax?
No. If an exempt item is purchased and falls under the threshold then the total consideration of the item will be exempt from state and local taxes during the sales tax holiday.
For more information, please visit dfa.arkansas.gov/newsEvents.
