Arkansas Revisiting Sales Tax Holiday Exemptions
- Feb 7, 2012 | Susan McLain
Each year, some states provide for various sales tax holidays, where some items are exempt from sales tax and some are not. Depending on the type of sales tax holiday, whether school, emergency or energy efficiency, the items that are exempt from sales tax must be clearly identified by the state.
In Rule 2012-2, Arkansas strives to provide a list that is indicative, but not “all-inclusive” of what is considered approved for the exemption during their back-to-school sales tax holiday.
- Clothing – “…an item of human wearing apparel suitable for general use for which the gross receipts or gross proceeds paid for the item of clothing is less than one hundred dollars ($100).”
- Clothing accessory or equipment – “…an incidental item worn on the person or in conjunction with clothing for which the gross receipts or gross proceeds paid for the item of clothing accessory or equipment is less than fifty dollars ($50).
- School art supply—“…an item commonly used by a student in a course of study for artwork.”
- School instructional material—“…written material commonly used by a student in a course of study as a reference and to learn the subject being taught.”
- School supply—“…an item commonly used by a student in a course of study.”
The ruling also includes a list of “…examples of items that are not clothing but is not intended to be an all-inclusive list.” I had to read that twice to realize they meant that they are providing a list of items that specifically do not qualify for the sales tax exemption during the holiday, but are sometimes considered clothing. In addition, it lists examples of other items that are not allowed sales tax exemption during the sales tax holiday.
The Arkansas sales and use tax holiday normally occurs “…from 12:01 a.m. on the first Saturday in August to 11:59 p.m. the following Sunday each year.”
The Excise Tax, revenue Policy & Legal Department is having a public hearing concerning the ruling on February 9, 2012 in Little Rock to allow public input and approval for the list of items noted in the ruling. For details of the event, please visit the Arkansas Department of Finance and Administration website.