Sales Tax Holiday Details for Consumers
Legislation enacted by the 2015 General Assembly combines the three existing sales tax holidays into one, three-day holiday beginning the first Friday in August at 12:01 a.m. and ending the following Sunday at 11:59 p.m. This year’s sales tax holiday is August 5-7, 2016.
During the combined sales tax holiday period, consumers may purchase qualified items exempt of the sales and use tax. The holiday is not restricted to Virginia residents. Anyone purchasing exempt items during the holiday in Virginia, or buying exempt items for immediate delivery to a Virginia address is eligible.
Detailed lists of exempt items:
- School Supplies, Clothing and Footwear
- Hurricane and Emergency Preparedness Items
- Energy Star™ and WaterSense™ Items
The sales tax holiday exemption applies to the sale of both new and used items if the item in question meets the exemption requirements.
During the sales tax holiday, when the sales price of an item is greater than the maximum allowable sales price for an exempt item, sales or use tax is due on the entire charge for the item.
Qualifying items purchased online, by mail or by telephone are exempt if 1) the item is both delivered to and paid for by the customer during the exemption period; or 2) the customer orders and pays for the item and the seller accepts the order during the exemption period for immediate shipment, even if delivery is made after the exemption period.
A sale of a qualifying item under a layaway plan qualifies for exemption if the customer places the qualifying merchandise on layaway during the holiday period, even if delivery and/or final payment occurs after the holiday period. Subsequent payments are also exempt from sales tax. Items placed on layaway prior to the sales tax holiday will only be eligible for the exemption if the final payment is made and the property is given to the purchaser during the exemption period.
Rain checks are eligible for the exemption if the item is purchased during the sales tax holiday period, regardless of when the item is actually delivered. If the rain check item is purchased prior to or after the sales tax holiday period, the exemption will not apply, even if the item is delivered during the sales tax holiday period.
If a dealer offers a discounted price for an item, a retailer's coupon or a manufacturer’s coupon during the sales tax holiday, the reduced sales price is used to determine whether the item is eligible for the sales tax exemption.
Rental items are not eligible for the tax exemption, regardless of whether the items are rented out and paid for during the sales tax holiday period.
If a vendor places a special order for a customer that must be custom-made or manufactured for future delivery after the holiday, the merchandise will not be considered as available for immediate delivery, and the transaction will not be eligible for the sales tax holiday exemption.
A gift certificate may not be used to reduce the price of an item to make that item eligible for exemption. However, eligible items purchased during the sales tax holiday period using a gift certificate will qualify for the exemption.
Where items are sold under a "buy one, get one free” or “buy one, get one for a reduced price" special, a retailer cannot average the total price of both items in order to qualify for the exemption.
A rebate occurs after a sale and does not constitute a reduction in sales price. The amount of the rebate is not considered when determining whether an item is eligible for an exemption.
If a customer purchases a qualified item during the tax exemption period and later exchanges it for a similar eligible item (even if a different size, different color, or other feature), no additional tax is due, even if the exchange is made after the exemption period. If a customer purchases a qualified item during the exemption period and returns the item after that period for credit on the purchase of a different item, the appropriate sales tax is due on the sale of the newly purchased item even if it would have been eligible for the exemption during the sales tax holiday period. If a customer purchases a qualified item before the exemption period and returns it during the exemption period for credit on the purchase of a different eligible item, no sales tax is due on the sale of the new item if it’s purchased during the sales tax holiday period.
To obtain a refund of tax paid in error, a customer must return to the store with his sales receipt and obtain a refund from the retailer.