Celebrate July 4th with an Exempt Flag
- Jul 3, 2015 | Gail Cole
What’s the best way to celebrate our nation’s independence? By exercising our right to freedom from taxation, of course. That as good a reason as any why retail sales of American flags are exempt from sales tax in numerous states.
According to the Tax Foundation, flags are exempt from sales tax in the following states:
- California (CA Rev. & T. Code )
- Connecticut (CN Gen. Stat. 12-412(23))
- Florida (FL Stat. 212.08(7)(F))
- Maryland (MD Code, Tax General 11-205)
- Massachusetts (MA Gen. Laws Ch. 64H 6(w))
- New Jersey (NJ Stat. 54:32B-8.26)
- New York (NY Tax Law 1115(a)(11))
- Pennsylvania (72 PA Stat. 7204(32))
- Rhode Island (RI Gen. Laws 44-18-30(34))
- Tennessee (TN Code 67-6-329)
- Vermont (VT Stat. tit. 32, 9741(33))
- Virginia (VA Code 58.1-609.1)
- West Virginia (WV Code 11-15-9(a)(49))
- Wisconsin (WI Stat. 77.54(46))
Certain states, like New Jersey, have called out the exemption on department of revenue websites. The New Jersey Sales Tax Notice reminds that the exemption is limited to actual New Jersey State or United States flags,” and does not extend to “mere representations of flags or to merchandise with a flag theme. So that Santa Claus figurine holding a miniature flag? It’s taxable.
The New York State Department of Taxation and Finance released a notice on July 2 reminding New Yorkers that “USA, NYS, POW and military flags are exempt from sales tax” year round. The exemption extends to certain military decorations when sold to active service members of veterans of the US military. Taxation and Finance Commissioner Jerry Boone even issued a statement on the subject:
“July Fourth is a great time to honor those brave men and women who fought for the freedoms we enjoy each day. I encourage New Yorkers to take advantage of this tax exemption and proudly display our nation’s flag as we celebrate Independence Day.”
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Lawmakers in Maine are considering legislation that would exempt the United States Flag from sales tax. Caveat: it must be made entirely of cloth or similar material.
Keeping up with sales tax
It’s up to sellers to inform themselves of sales tax rates, rules, and regulations. In other words, the onus falls on flag vendors to correctly apply sales tax or sales tax exemptions in all states where sales are made. And it can be an onerous task.
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