Ohio enacts sales tax holiday for clothing, school supplies

Ohio Gov. John Kasich has signed Senate Bill 9, thereby creating a one-time, three-day sales tax holiday for qualifying clothing and school supplies.

The tax-free period is set to run August 4–6, 2017. During that time, the following will be exempt from Ohio sales tax:

• Clothing costing $75 or less, including:
  • Aprons
  • Athletic supporters
  • Baby receiving blankets
  • Bathing suits and caps
  • Diapers (adult and children)
  • Formal wear
  • Garters, garter belts, and girdles
  • Sandals and shoes
  • Underwear
  • Uniforms
  • Wedding apparel

• School supplies costing $20 or less, including:
  • Binders and book bags
  • Calculators and compasses
  • Crayons, pens, and pencils
  • Lunch boxes
  • Notebooks and paper
  • Rulers and scissors

• School instructional material priced at $20 or less, including:
  • Globes
  • Reference maps
  • Textbooks
  • Workbooks

Not all clothing, school supplies, or instructional materials are exempt. Taxable items include, but are not limited to:

• Any otherwise qualifying item if purchased for use in a trade or business
• Clothing accessories
• Protective equipment
• Sports or recreational equipment

See the Ohio Department of Taxation for information about how the tax-free period affects discount sales, rain checks, rebates, and more.

Sales tax holidays are generally popular among consumers, who simply benefit from the tax savings. For retailers selling qualifying products, they are more of a mixed bag. It is often necessary to increase staffing during a tax-free period, and point-of-sale systems must be adjusted to account for the lack of tax. In short, sales tax holidays complicate sales tax compliance, which is complicated enough as it is.

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