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Sales Tax on Clothing and Footwear Under $110 Waived Monday Through Sunday
Monday, January 31, 2005
Senate Majority Leader Joseph L. Bruno today reminded his constituents that they do not have to pay sales tax when they purchase clothing and footwear that cost less than $110 per item this week in New York. State and local sales tax will be lifted for the week beginning January 31 and ending on February 6.
"This is a great opportunity for shoppers to find more competitive pricing, shop locally and save substantial dollars on clothing and shoes," said Senator Bruno. "Tax free weeks have been very successful in the past, benefiting both consumers and retailers. People of the Capital Region should try and take advantage of this to save money on their purchases."
Attached is information gathered from The New York State Department of Taxation and Finance:
One-week exemption period - January 31, 2005, through February 6, 2005)
Temporary Sales and Use Tax Exemption of Clothing, Footwear, and Items Used to Make or Repair Exempt Clothing
As announced on September 8, 2004, in TSB-M-04(6)S, Sales Tax on Clothing and Footwear Remains in Effect until June 1, 2005, clothing, footwear, and items used to make or repair clothing continue to be subject to New York State and local sales and use taxes until June 1, 2005. However, clothing and footwear and items used to make or repair exempt clothing, costing less than $110 per item or pair, are exempt from New York State sales and use taxes when purchased during the one-week exemption period beginning on Monday, January 31, 2005, and ending on Sunday, February 6, 2005. The one-week exemption does not apply to locally imposed sales and use taxes unless the county or city imposing those taxes elected the exemption.
Likewise, the one-week exemption does not apply to the �% tax imposed by the state in any portion of the Metropolitan Commuter Transportation District (MCTD), unless the county or city in the MCTD provided an exemption from its own tax, in which case the exemption will also apply to the �% MCTD tax in that county or city. The MCTD consists of the city of New York and the counties of Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk and Westchester.
Description of the clothing and footwear exemption
The one-week exemption applies only to clothing and footwear worn by humans. It also applies to most fabric, thread, yarn, buttons, snaps, hooks, zippers, and like items which become a physical component part of exempt clothing or that are used to make or repair exempt clothing.
While the exemption applies to items of clothing and footwear worn on the body, not all items worn on the body qualify as clothing or footwear. Jewelry, watches, and like items remain taxable.
Equipment items, such as tool belts, hard hats, and sport, bicycle and motorcycle helmets, though worn on the body, remain taxable. Protective goggles and safety glasses (unless prescription) for sport or occupational use, protective sport or occupational masks or pads, hockey and baseball fielders� gloves or mitts, ice skates and roller skates, fireplace mittens, and similar pieces of equipment (sporting or otherwise) also remain taxable. Antique clothing and footwear are exempt if they are purchased for human wear and not as collector� items. All purchases of doll and pet clothes and footwear are taxable.
If exempt clothing or footwear is sold with other taxable merchandise as a single unit, the full price is subject to sales or use tax, unless the price of the clothing or footwear is separately stated. Forexample, a store has a boxed gift set for sale that has a French-cuff dress shirt, cufflinks and a tie tack. The gift set is sold for a single price of $50. Although the shirt sold by itself would be exempt, the full price of the boxed gift set would be taxable because the cufflinks and tie tack are taxable and the selling price of the shirt is not separately stated.
Sales and Use Tax Exemption of Clothing, Footwear, and Items Used to Make or Repair Exempt Clothing Effective Monday, January 31, 2005, through Sunday, February 6, 2005
Listing of Exempt and Taxable Items
Exempt Items
Aerobic clothing
Antique clothing (for wear)
Aprons
Arch supports*
Arm warmers
Athletic supporters
Athletic or sport uniforms or clothing (but not equipment such as mitts, helmets and pads)
Bandannas
Bathing caps
Bathing suits
Beach caps and coats
Belt buckles
Belts/suspenders
Bibs (baby)
Blouses
Boots (climbing, fishing, riding, ski, waders)
Bridal gowns and veils (unless rented)
Caps
Coats and wraps
Corset laces
Coveralls
Diapers (adult - including disposable)*
Diapers (children - including
disposable)
Dress shields
Dresses
Ear muffs
Formal clothing (unless rented)
Fur clothing
Garters/garter belts
Girdles
Gloves (batting, bicycle, dress [unless rented], garden, golf, ski, tennis, work)
Graduation caps and gowns (unless rented)
Gym suits
Hand muffs
Handkerchiefs
Hats
Hosiery (panty hose, peds, etc)
Insoles
Jeans
Jogging suits
Lab coats
Leg warmers
Leotards
Lingerie
Pajamas
Ponchos
Prom dress (unless rented)
Rain wear
Receiving blankets
Religious clothing
Rented uniforms (unless formal wear/costume)
Riding pants
Robes
Scarves
Scout uniforms
Shawls and wraps
Shirts
Shoes (ballet, bicycle, bowling, cleated, football, golf, jazz/dance, soccer, track, etc.)
Shoe inserts
Shoe laces
Shoulder pads, for dresses, jackets, etc. (but not athletic or sport protective pads)
Shower caps
Ski masks
Sleepwear
Slippers
Sneakers
Socks
Sports clothing and uniforms (but not equipment such as mitts, helmets and pads)
Stockings
Support hosiery
Suspenders
Sweat bands
Sweat suits
Ties/neckwear
Tights
Tuxedo (unless rented)
Underwear
Uniforms (occupational, military, scouting, sport)
Wet and dry suits
0Yard goods, and notions**
Taxable Items
Antique clothing (collectable - not for wear)
Barrettes
Bobby pins
Costumes
Crib blankets
Elastic ponytail holders
Goggles (unless prescription*)
Hair bows
Hair clips
Handbags and purses
Headbands (Sweatbands are exempt)
Helmets (sport, motorcycle, bicycle, etc.)
Ice skates
In-line skates
Jewelry
Key cases
Mitts (baseball fielder� glove, hockey, etc.)
Party costumes
Personal flotation devices
Protective masks (athletic, sport or occupational)
Roller skates
Safety glasses (unless prescription*)
Sewing accessories (not an integral part of clothing such as chalk, instruction books, knitting needles, measuring tapes, needles, patterns, scissors, pins, thimbles )
Shin guards and padding
Shoulder pads (football, hockey, etc.)
Sunglasses (unless prescription)
Umbrellas
Wallets
Watch bands
Watches
Wigs
Yard goods and notions**
* Items marked with an asterisk are exempt regardless of their price.
** Yard goods and notions (fabric, thread, yarn, buttons, snaps, hooks, zippers and like items) used or consumed to make or repair exempt clothing which become a physical component part of the clothing are generally exempt. See pages 2 and 3 for additional details concerning the taxability of yard goods and notions.
The lists are intended as a guide and are not all-inclusive.
Previously issued lists should not be used.
The following additional limitations will apply to the exemption.
� The article of clothing or footwear (per pair) must be sold for less than $110. This less than $110 limitation also applies to each item of fabric, thread, yarn, buttons, snaps, hooks, zippers, and like items which become a physical component part of exempt clothing or that are used to make or repair exempt clothing. A charge by the vendor for alterations to clothing sold by the vendor should be included when determining whether the less than $110 limitation has been met, unless the vendor separately states a reasonable charge for the alteration on the receipt given to the purchaser of the clothing [see TSB-M-02(4)S].
� Costumes and rented formal wear are not eligible for exemption. Nor does the exemption apply to fabric, thread, yarn, buttons, snaps, hooks, zippers, and like items which become a physical component part of costumes or rented formal wear or that are used to make or repair costumes or rented formal wear.
� Items of fabric, thread, yarn, buttons, snaps, hooks, zippers and like items used to make or repair otherwise exempt clothing are not eligible for exemption if the item is made from real or imitation pearls, or from real or imitation precious or semiprecious stones, jewels, or metals.
� Most accessories (such as handbags, umbrellas, watches, and watchbands) are not considered clothing and are taxable. However, belt buckles, handkerchiefs, sweatbands, head scarves, and neckwear, such as scarves and ties, are exempt.
� Fabric, thread, yarn, buttons, snaps, hooks, zippers, and like items used to make or repair taxable products are taxable.
� Monogramming of clothing prior to its sale is eligible for exemption if the monogramming is sold in conjunction with the sale of the clothing and the price for the monogrammed item is less than $110. However, if the monogramming is done separately by a vendor for a separate charge, the charge for this service is taxable. This limitation also applies to the application of decals, logos and like items (e.g., pictures or letters) by sewing, printing, imprinting, silk screening, and the like. Delivery, shipping and handling charges (delivery)
Reasonable, separately stated charges by the vendor for delivery of eligible clothing and footwear are not taken into account in determining if the cost of an item is less than the $110 limitation. For example, if an article of clothing sells for $95 and the vendor charges $20 for delivery, the clothing and the delivery charge qualify for exemption. However, delivery charges by the vendor for items or pairs costing $110 or more remain subject to tax.
Coupons
Where a customer uses a manufacturer� coupon to pay for an article of clothing or a pair of shoes or other articles of footwear, the value of the coupon does not reduce the selling price for purposes of determining whether the article or pair is sold for less than $110. But where a customer pays for clothing or footwear using a store coupon, for which the store receives no reimbursement, the store coupon does reduce the selling price of the clothing or footwear for purposes of determining whether the item is sold for less than $110.
The following provides information on transitional provisions that apply to the one-week
exemption period, a description of the clothing and footwear exemption, and a listing of exempt and taxable items during the exemption period.
MAIL AND TELEPHONE ORDERS
The exemption will apply to purchases that are ordered by mail or by telephone if the orders are accepted by the vendor during the one-week period of exemption. An order is accepted by the vendor when the vendor has taken an action to fill the order. Actions to fill an order include placing an in-date stamp on a mail order or assigning an order number to a telephone order. As long as the vendor accepts the customer� order during the exemption period, the exemption will apply even though delivery might be made after the exemption period has ended. These rules will also apply to orders made using the Internet and email.
LAYAWAY SALES
A layaway sale is a sale in which merchandise is set aside for future delivery to a customer who makes a deposit and agrees to pay the balance of the purchase price over a period of time before the merchandise is delivered. The sales price of the merchandise includes any additional charges a vendor makes for putting the merchandise on layaway. If a vendor and a customer enter into a contract for a layaway sale of eligible clothing or footwear during the exemption period, the exemption will apply as long as the customer makes a deposit of at least 10% of the purchase price during the exemption period and the merchandise is segregated from other inventory.
CUSTOM AND SPECIAL ORDERS
Eligible clothing and footwear and items used to make or repair exempt clothing that are custom ordered or special ordered during the exemption period will qualify for the exemption, even though the item is delivered after the one-week exemption period. To qualify for the exemption, the vendor and the customer must enter into a contract during an exemption period to have the custom or special order made for the customer.
RAIN CHECKS
The exemption will apply to purchases made with a rain check during the exemption period. The exemption will not apply to purchases made after the one-week exemption period has ended, even though the purchaser uses a rain check that was issued during the exemption period.
EXCHANGES
Where a customer makes a purchase during the one-week exemption period and returns to exchange the item after the exemption period has ended, the vendor need not charge tax on the exchanged item as long as it is similar to the item returned (i.e., a shirt for a shirt, one pair of shoes for another, etc.), and the exchanged item itself otherwise meets the requirements for exemption.
If a customer returns an item and receives a credit to purchase a different item in the future or is allowed to purchase a different item at the time of the return, the appropriate sales tax will apply to the sale of the new item. For example, if a customer buys a shirt during the one-week exemption period and exchanges it a week after the exemption period has ended for a pair of boots, tax is due on the full price of the boots.
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