Avalara > Blog > Sales Tax > Cowboy Boots to Blueberries: Sales Tax Laws on Regional Products, Part 1

Cowboy Boots to Blueberries: Sales Tax Laws on Regional Products, Part 1

  • Jun 20, 2016 | Bethany McDonald

Timber, cattle, cars, oil, potatoes, corn, chemicals, and seafood -- U.S. products are as diverse as the regions from which they originate. Despite the varied nature of our nation’s products, they all have one thing in common: The sales tax rules surrounding them can be confusing!

So whether you’re looking to buy or sell a bushel of blueberries in Maine, cowboy belt buckles in Texas, or a new car in Michigan, we’re here to help you sort out the sales tax laws for a successful transaction. Here are a few states with interesting sales tax rules for regional products.

Texas: Cowboy Apparel

There are more farms and ranches in Texas than in any other state, with the cattle industry alone generating upwards of $10.5 billion per year. It’s no wonder then that cowboy culture and style is alive and well in the Lone Star State. However, if you’re looking to purchase or sell cowboy apparel, such as hats, boots, and buckles, it’s important to know that Texas holds special tax-free holidays in which normally taxed apparel is exempt from the state’s 6.3 percent sales tax.

This year’s sales tax holiday will be held from August 5-7, with cowboy shirts, jeans, hats, boots, and belts priced under $100 exempt from sales tax. However, if you want that snazzy belt buckle or leather chaps to go with your new duds, expect to pay the full sales tax, regardless of the holiday, as these are considered accessories and safety clothing, respectively.

Louisiana: Crawfish

Whether called crawfish, crayfish, crawdads, or freshwater lobsters, these delicious crustaceans generate upwards of $120 million in revenue per year for the state of Louisiana. In fact, Louisiana is the largest domestic provider of crawfish (as well as shrimp, oysters, crabs, and alligator) in the US. In order to promote its crawfish industry, Louisiana exempts the sales of materials used in the production of crawfish, including nets and other fishing gear.

Michigan: Cars

Michigan is synonymous with cars, and is the North American headquarters to some of the biggest names in the industry including Ford, General Motors, Toyota, Nissan, Hyundai, and Kia. If you’re planning on buying a vehicle in the Great Lakes State, it actually pays to be a nonresident. Why? Sales of new and used automobiles, buses, trucks, tractors, trailers, motorcycles, and other vehicles are usually subject to sales tax. However, the sale of a vehicle for delivery and use outside Michigan is exempt from sales tax.

Maine: Wild Blueberries

Rugged wild blueberries are perfectly suited for Maine’s acidic soil and harsh conditions. It’s no wonder then that Maine is the largest producer of wild lowbush blueberries in the world, and produces 10 percent of all blueberries in North America. Wild blueberries generate over $250 million in direct and indirect revenue for the state per year.

In order to protect its finite wild blueberry crops, as well as to promote research and support development of activities related to the wild blueberry industry, Maine instituted the Maine Wild Blueberry Tax, which levies a tax onto processors, shippers, and sellers of this crop. Specifically, either the processor that first receives unprocessed blueberries, or the shipper that transports unprocessed blueberries out of state, is required to remit a $0.015 tax per pound to the state. One-half of this tax can be passed on from either the processor or the shipper to the seller.

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.
Avalara Author
Bethany McDonald
Avalara Author Bethany McDonald