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North Carolina Reconsiders Sales Tax Holiday in 2016

  • May 9, 2016 | Gail Cole

 North Carolina considers reenacting a sales tax holiday in 2016.

The state of North Carolina used to provide two sales tax holidays: An August tax-free period for clothing and school supplies and a November holiday for many Energy Star products. In 2014, both were repealed and North Carolina retailers were prohibited from absorbing sales tax or directly or indirectly advertising the absence of tax. Now there is talk of reenacting one of them.

Last year during South Carolina’s tax-free period, retailers in North Carolina prepared for sales to drop, as they had during South Carolina’s 2014 holiday. Yet they also fought back, coming up with creative ways to keep North Carolinians shoppers north of the border. Many offered “Better than tax free” sales, reducing prices by 10% or even 15%.

This year may see the return of at least one North Carolina sales tax holiday. Senate Bill 753, introduced in late April and currently under review in the Committee on Finance, would “reenact the sales and use tax holiday for school supplies.”

The bill’s primary sponsor Sen. Paul A. Lowe Jr (D) was prompted to restore the tax-free period by struggling constituents: “We’ve got to find a way to help working families.” A number of business owners have also expressed support of the bill, which they hope will boost sales.

Sales and use tax holidays in any state can complicate compliance. Sales tax software like Avalara AvaTax simplifies it. Learn more.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
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.