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Texas Sales Tax Holidays Encourage Conservation


 Precious water.

In the wake of epic flooding in Texas, it may be difficult to recall that the Lone Star State suffers its share of drought, and then some. In 2011, it weathered a “drought of historic proportions.” Last fall, shortly after record rains, parts of Texas once again experienced extreme drought. And at this moment, as people in the Houston area recover from deadly floods and eye the sky with concern, the Texas Panhandle is abnormally dry.

In other words, it is wise to conserve water in Texas.

To encourage just that, state lawmakers have created a new tax-free period for certain water-efficient and water-conserving products. It runs May 28 – 30, 2016.

Exempt

During this time, the following products will be sold without sales tax throughout the state of Texas:

  • Any product with a WaterSense label or logo
  • Items used or planted for:
    • Conserving or retaining groundwater
    • Decreasing ambient air temperature
    • Recharging water tables

Examples of exempt items include:

  • Moisture control for sprinklers and irrigation systems
  • Mulch
  • Permeable ground cover surface
  • Plants, trees and grasses
  • Rain barrels or alternative rain and moisture collection system
  • Soaker or drip irrigation hoses
  • Water-saving surfactants

Taxable

  • Awnings and other shade-creating products
  • Construction/building materials
  • Sprinklers

Energy efficiency

Memorial Day weekend has traditionally hosted another tax-free period in Texas, the Energy Star Sales Tax Holiday. It will be offered again in 2016, also May 28 – 30.

As in prior years, most Energy Star labeled products purchased or delivered in Texas are exempt from state and local sales tax. Exempt items include the following:

  • Air conditioners priced at $6,000 or less
  • Ceiling fans
  • Clothes washers
  • Dehumidifiers
  • Dishwashers
  • Programmable thermostats
  • Refrigerators priced at $2,000 or less

Retailers are not permitted to charge sales tax on qualifying products during sales tax holidays. Sales tax software (SaaS) helps business remain compliant at all times. Learn how it works.


Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.