Education

Retailers Get Ready for Sales Tax Holiday

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by William B. Wood

Good news, Gwinnett retail businesses – after a two-year hiatus, the Georgia sales tax holiday returns just in time for back to school sales. The Georgia Legislature in House Bill 386 has approved a sales tax holiday for Aug. 10 and 11, 2012, waiving the tax for many back to school items purchased for personal use. The exemption does not include furniture or any items primarily designed for recreational use.

Introduced in 2002, the sales tax holiday has been suspended since 2010 due to deficient tax revenues. Because tax revenues are strong enough this year such that this holiday was among other tax reform measures approved for 2012.

From 12:01 a.m. on August 10 through midnight August 11, purchases of the following items are exempt from state and local sales tax:

  • Clothing and footwear with a sales price of $100 or less per article of clothing or pair of footwear, excluding accessories such as jewelry, handbags, umbrellas, eyewear, watches and watchbands.
  • Computers and computer-related accessories purchased for home and personal, not business, use. The purchase price for the computer items is capped this year at $1,000 and covers computers, PDAs, peripherals, modems and non-recreational software.
  • #School supplies, for personal use, to be used in the classroom or in doing homework, up to a sales price of $20 per item. This exemption covers pens, pencils, notebooks, paper, book bags, calculators, dictionaries, thesauruses, children”s books and books listed on approved school reading lists for pre-kindergarten through 12th grade.

The Georgia Department of Revenue will announce rules to govern the implementation of the exemption. For now, the “Sales Tax Holiday” regulation contained in Georgia Rules and Regulations 560-12-2-.110, that applied to the exemption in prior years, will provide you with guidance to help your business get ready to handle these sales.

Bill Wood is a longtime Gwinnett resident and moved his business law practice from Atlanta to Lawrenceville in 2011, and may be reached at www.wbwoodlaw.com or bwood@wbwoodlaw.com.