As back-to-school approaches so too does the annual financial strain of notebooks, pencils and backpacks.
The state of Iowa will hold its annual tax holiday on select clothes and shoes this Friday and Saturday, giving some relief to the cost of sending students back to school.
“We’re really excited. Back-to-school is a wonderful time to get some of these things,” Nathan Sondgeroth, president of the Clinton Area Chamber of Commerce, said.
Select clothing and footwear will be exempt from the 7-percent sales tax from 12:01 a.m. Friday to 11:59 p.m. Saturday. All businesses across the state that are open these days are required to participate in the tax holiday.
Steve Blackburn, owner of Brown’s Shoe Fit, said he doesn’t understand why a business wouldn’t want to participate in the tax holiday.
“It’s actually very good for us, especially since it coincides with back-to-school,” Blackburn said. “People love it.”
Brown’s Shoe Fit will be fully stocked and ready for customers taking advantage of tax-free shoes.
Sondgeroth anticipates an influx of shoppers to Clinton-area retailers because of the tax holiday.
“Clinton is a regional center of commerce...so we should expect to see increased retail sales,” Sondgeroth said. “People from Illinois already come to the area to shop; this is an extra incentive.”
According to Victoria Daniels, public information officer for the Iowa Department of Revenue, Iowa retailers reported $14.6 million in tax-exempt sales in 2011. A majority of these sales are made during the tax holiday weekend. Daniels also said consumers saved $877,000 in state sales tax, not to mention any local taxes, which also are waived.
Shoppers should be aware of guidelines restricting what items are exempt this weekend. Watches, jewelry, umbrellas, handkerchiefs, sporting equipment, skis, swim fins, roller blades, skates, and clothing designed specifically for athletic performance or protection are not included in the tax holiday.
Also, items costing more than $100 will not be exempt. For example, if a dress costs $150, the customer will need to pay tax on the dress. Your entire bill can be more than $100 and still be tax free.
Further, items usually sold as a set, such as shoes or a suit, will not be sold separately in order to be tax free.
For example, if a pair of shoes normally costs $130, each shoe cannot be sold for $65 in order to be tax free. The $100 limit only applies to individual items.
A full list of exempt items and policies is available at the Iowa Department of Revenue’s website.