In the two-week text, “almost all tangible personal property is $500 or less.”
Bedford Heights, Ohio – The two-week duty-free holiday in Ohio begins, and shoppers aren't the only ones seeing the gains. Local businesses say the haste is pushing sales far beyond back-to-school merchandise, which store owners call their busiest year of the year.
At the Thriftique showroom in Bedford Heights, customers can shop just a few hours after the holidays begin.
“We've sold a set of dishes. We've sold a lot of home decor, clothes, a lot of clothes,” store manager Abbe Froimson laughed. “It's definitely more messy, busy, and more friendly. People are so excited to not pay taxes!”
Ohio will offer a two-week full-week duty-free purchase for $500 or less. The initial school supplies rest now include clothing, electronics, furniture, and even food and beverages.
Tax Policy Secretary Tim Lynch said savings quickly added up and Ohioans are estimated to save about $295 million in sales tax.
“When they hear the total number of sounds – expecting some changes in the end, not there – they like, 'Oh, yes!'” Fromson said with a smile.
For stores like Thriftique, inventory is constantly changing, and holidays bring customers back.
“We're happy to serve our customers and get them back and make it exciting,” explained Fromson. “They may find another deal tomorrow.”
But not all shopping trips go smoothly. Last year, some businesses were not ready, causing customers to make mistakes in their business taxes. The state has been sending resources and information to every licensed provider in Ohio to help prevent this year’s problems.
If the shopper imposes taxes, the Tax Department will have staff ready to help with a refund request.
“Our employees will work with them to get the appropriate refund request and send them a refund check,” Lynch assured. “Our employees also want to educate businesses as they did last year. Our employees will contact them and have a conversation with them to let them know that they do take the business tax holiday.”
The tax-free holiday in Ohio lasts until August 14, and the Taxation Department created a dashboard to help suppliers and consumers navigate over the next two weeks. If you think you are taxing incorrectly in your transaction, the help number is 800-750-0750.
What items are included in the business tax holiday?
“Almost all tangible personal property is $500 or less,” Gov. Mike Dewine's office said.
Need an example? Here is a list of certain items that will be exempt from taxes during this period:
- electronic: Computers, TVs and other gadgets
- clothing: Any clothing item
- books: All types, including novels and textbooks
- Household supplies: Furniture, kitchenware and home decoration
- plant: Indoor and outdoor plants
- Sports Goods: Sports equipment and clothing
- Food and drinks: Meal food, dietary supplements and soft drinks
“During this period, many other items will also be exempt from sales tax,” the department said.
What projects are excluded?
During the business tax holiday, the following items will still be taxed:
- Boat or outboard motor
- car
- Alcohol drinks
- Tobacco products
- Steam products
- Items containing marijuana
What about online shopping?
Yes! Qualified items purchased online will also be tax-free.
Here is how the Ohio Department of Taxation explains:
“If the consumer order and payment accepts an order during the exemption period, even if the delivery is made during the exemption period, eligible items sold to the consumer via mail, phone, email or the internet should be eligible for the exemption tax exemption.”
Transport and processing
- Shipping and handling costs are not taxable if all items on shipment are eligible for qualified items and the sale price of each item is within the sales tax vacation price threshold.
- If the goods include exempted items and taxable items, the seller shall allocate the shipping and disposal fees to the total price of all items in the goods based on the total price of the taxable items. Retailers must charge taxes on the portion of the transportation and handling expenses of taxable items in the goods.
What is the price limit for $500?
Items sold for $500 or less will be tax-free.
“If an item sells for more than $500, the tax should be paid at the entire selling price,” the tax department said.
What if my total purchase price exceeds $500?
“For example, buying two shirts, two pairs of pants, a pair of shoes and a jacket (each priced at $100, total purchase of $600) is tax-free,” the Tax Department explained. “There is no limit on the amount of total purchase. Qualifications are determined by item.”
What about communication and reward?
Here are three points you need to know from the Ohio Department of Taxation:
- If a consumer purchases qualified goods during a business tax holiday and then exchanges them for the same goods, the retailer should not receive a business tax even after the business tax holiday is over.
- If a consumer purchases a qualified item during the business tax holiday and returns the item after the tax period for purchasing another item, the retailer must charge sales tax on the sales of the newly purchased item, even if the item is eligible for exemption during the sales tax holiday.
- If a consumer purchases a qualified item before the holiday but returns the item during the sales tax holiday and receives credit when purchasing other qualified property, the sales tax on the sale of new items shall not be paid. The retailer must provide consumer credit for the purchase price and business tax paid for the items being refunded.
Are there any more questions?
The Ohio Department of Taxation answered 31 general questions about business tax holidays.