Sometimes, it pays to procrastinate
Some call it “Maryland Pretends to Be Delaware Week,” but Maryland Comptroller Peter Franchot is fully supportive of it, and there’s still plenty of time to take advantage of it.
We’re talking about Shop Maryland Tax-Free Week, which started Sunday and lasts through this Saturday, Aug. 20. During this period, selected clothing and footwear items are exempt from Maryland’s 6 percent sales tax.
With many schools opening next week, it’s perfectly timed, of course. Students need new clothes and shoes, and families can save money. Sounds like a win-win situation.
“Shop Maryland Tax-Free Week is a great opportunity to get deals on back-to-school clothes or to refresh a tired wardrobe,” Franchot said in a statement. “During these tough economic times, having a break from the 6 percent sales tax on shoes and clothing can make a real difference for families, enabling them to save more of their hard-earned money.”
Qualifying articles of clothing $100 or less are exempt from the sales tax no matter how many items are purchased at a single time. For example, a shopper could buy two qualifying items for even $95 each and would still receive the waived sales tax despite the total amount exceeding $100.
And if a business is selling an item that doesn’t qualify for the tax exemption, that retailer can still offer the items without the sales tax as long as it pays the tax owed to the state for the customer.
The Maryland General Assembly passed legislation in the 2007 special session allowing for a tax-free week to occur the second week of August every year. At that time, state lawmakers also instituted a three-day weekend in February for certain Energy Star Products, such as air conditioners, furnaces, dehumidifiers and LED light bulbs.
“Back-to-school shopping is the second biggest shopping season for retailers,” Maryland Retailers Association spokesperson Tom Saquella said in a statement. “Tax-Free Week has become a welcomed opportunity for consumers to save on clothing and footwear as they prepare for the new school year, and also for adults looking to buy something from the new fall clothing lines. Tax-Free Week is a wonderful gift provided every year to Maryland taxpayers, and you can count on Maryland retailers to do their part with great sales and promotions.”
Though the savings may be aimed for back-to-school shoppers, the sales do not include school supplies as tax-free items. Accessories, such as jewelry, watches, handbags, belt buckles, backpacks and ties, do not qualify.
See www.marylandtaxes.com for an extensive list of what qualifies and what doesn’t.
If an item is purchased during the tax-free week but is returned after the week finishes, no additional tax will be due if the item is exchanged for the same item but is a different size or color. If the item is returned for store credit on the purchase of a different item, the customer will pay the full sales tax for the new item. If the item is purchased before the tax-free week and is returned during the week for store credit on different items, the customer does not have to pay the sales tax.
So for those who have put off back-to-school clothes shopping until the last minute, this might turn to be the one time it pays to procrastinate.