Summer vacation for area students is winding down, and with that comes the task – and expense – of shopping for new clothing.
Next weekend’s sales tax holiday will help those looking to save a little money on clothing items needed for school, work or whatever fashion desire can be met.
In 2007, the Oklahoma Legislature passed Senate Bill 861 to benefit consumers and retailers by providing three days of sales-tax exempt shopping. The tax holiday was designed to help businesses by providing a boost to the local economy, while the consumer receives the benefit of saving money when shopping for clothes and shoes.
“Anybody can participate,” said Tahlequah City Treasurer Lanney Williams. “We comply with everything that [Senate Bill 861] says.”
According to the Oklahoma Tax Commission’s website, tax holiday window opens at 12:01 a.m., Friday, Aug. 3, and closes at midnight, Sunday, Aug. 5. Participation is mandatory for retailers, who may not charge tax on clothes and shoes that are legally tax exempt. Items include clothing and footwear intended to be worn for general purposes, like school or work, and the price of the article is less $100. Clothing or footwear designed primarily for athletic activity or protective use that is not normally worn under a general conditions is not tax exempt.
“Things like [football] cleats might not apply, but regular running shoes and dress shoes do,” said Williams. “Most clothing items, including undergarments, also apply.”
The OTC website states if a retailer has a “buy one, get one free sale”, the total price of the clothing or shoe items cannot be averaged to qualify both items for tax exemption, which is determined by the actual price paid for each item. Individual clothing or shoes must be priced at $99.99 to qualify. Retailer-offered discounts through coupons or other forms of price-reduction promotions that decrease the price of an item to less than $100 will also qualify for the exemption.
This applies to all discounts, even when a retailer’s coupon or loyalty card is required to reduce the price of a clothing or shoe item. But, if a retailer accepts a discount ticket, like a manufacturer’s coupon, that entitles the retailer to third-party repayment, the reduced price enabled by the discount ticket does not reduce the item’s sale price for the purpose of determining whether the clothing or shoe article is eligible for tax exemption.
Local businesses have seen an increase in sales and store traffic as a result of the tax holiday.
Before the bill was passed, customers left the state to buy back-to-school clothes and shoes, said Workman’s Department Store Owner/Manager Charles Workman.
“It’s good for business, because everybody used to go to Texas, but now they stay here” he said. “Sales are down for everybody, but they’ll buy this weekend rather than any other weekend. People are going to take advantage of every penny they can. And they need to.”
Felts Family Shoe Store Assistant Manager Drew Felts said the tax holiday draws a wide variety of customers, aside from the traditional back-to-school shoppers.
“We’re always busy during the tax holiday,” he said. “The first year was the best, but every year has been good. It’s slowed down a little, but we’ve still have good business on that weekend.”
Oklahoma State University Extension Office Family Consumer Science Educator Heather Winn said families need to develop a plan before they go out shopping in order to maximize the financial opportunity.
“One way for parents to take advantage of a tax-free weekend is to get out and shop for items needed on that weekend,” she said. “A few other tips include, be sure to take inventory of leftovers from last school year and items you already have, make a shopping a list of items needed for school, then check sales ads and clip coupons when possible. Before shopping, have a discussion with your children about your back-to-school budget and have a plan.”
For more details on the sales tax holiday, visit the OTC website at www.tax.ok. gov/stholiday.html.
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