The state’s four-percent sales tax is waived throughout the state, while sales taxes levied by 304 cities and counties also are waived on:
- clothing priced at $100 or less;
- school supplies valued at $50 or less;
- books that cost $30 or less; and
- computers and computer equipment with a selling price of $750 or less.
In honor of the holiday’s 10th anniversary, the Alabama Retail Association presents the top 10 facts about Alabama’s August sales tax holiday:
10) Alabama’s sales tax holiday is a decade old. Our state was among the first half dozen states to have a back-to-school sales tax holiday. A total of 17 states have such holidays.
9) Alabama offers more tax-free items than Mississippi or Florida. Only clothes and shoes are tax free in Mississippi, while Florida has a lower threshold for school supplies and offers no tax break for books. All of the surrounding states have sales tax holidays.
8) The tax holiday is an every year event for more and more localities. While the tax holiday occurs statewide every year for the state tax, a core group of 145 localities have added their local tax savings every year since 2006. Sixteen new cities voted this year to automatically participate annually in the holiday: Arab, Bridgeport, Daphne, Decatur, Fairfield, Fairview, Fort Payne, Malvern, Montevallo, Opp, Pell City, Satsuma, Stevenson, Sylvania, Vina and Vincent.
7) You can save in more places, sometimes as much as 10 percent. A record 304 local governments (59 counties and 245 cities) will add their sales tax savings to the four percent savings you can find throughout the state, breaking last year’s record-setting count of 291 participating localities. In some areas, the savings reach 10 percent when state and local taxes are waived. Eight cities join the sales tax holiday for the first time: Bridgeport, Camp Hill, Fairview, Hillsboro, Stevenson, Vance, Vina and Vincent; and eight localities are back after sitting out one or more years: Adamsville, Columbia, Geneva County, Moulton, Phil Campbell, Piedmont, Prichard and Sylvania.
6) The average Alabama family with school-age children could save close to $63 and those with college-age children could save as much as $96. According to the National Retail Federation’s annual survey, the average family in the South with school-aged children is expected to spend $627.01 on back-to-school items. For parents with college-age students in the South, the average jumps to $961.22.
5) Alabamians should spend $1.02 billion on back-to-school shopping. Alabama sales generally represent 1.5 percent of all retail sales nationally. The National Retail Federation projects $68 billion will be spent nationally this back-to-school shopping season. For many businesses, back-to-school is the second biggest shopping period of the year behind holiday shopping.
4) Alabamians will spend close to $4.6 billion in August. That is all sales, all month, not just on back-to-school and represents a 3 percent growth over 2014, when Alabamians spent almost $4.5 billion in August.
3) Alabama’s August sales tax collections have grown eight of the first nine years of the sales tax holiday.
2) The sales tax holiday is for everybody, not just those going back to school. They don’t check your school I.D. at the cash register and the items that are tax free are used by a broad range of consumers, not just those who are in school. Those interested in filling out their wardrobes and stocking their libraries and home offices also can benefit from buying during the tax-free weekend.
1) The sales tax holiday is everywhere in the state and most retailers carry one or more of the items covered. Everyone in the state gets to purchase the specified items free of the state’s 4-percent sales tax. Participating localities also offer breaks on their local sales taxes, adding to the savings. Alabama retailers are required to participate in the state’s sales tax holiday and cannot charge sales taxes on any item that is legally tax exempt. Walk into a convenience, grocery, clothing, shoe, school/office supply or computer store and you’ll find something that is tax free.
CONTACT: Nancy King Dennis | 334.551.0643 | 800.239.5423