When I was in school, there was no such thing as a sales tax holiday. Whatever I needed and bought for school, I paid a state sales tax on. Recently though, more and more states have adopted a sales tax holiday for back to school shopping.

You may be asking why would a state do such a thing? The state doesn’t collect any sales tax money so it doesn’t help the state at all. It actually does. The state might not collect a sales tax on the back to school items a person is purchasing, but the hope is that while they shop, they will buy other items that aren’t included as tax free.

This isn’t saying that the state is trying trick shoppers, rather it means the state is simply trying to spur sales. This is the same thing as an electronics store offering a DVD bundle for free with the purchase of a DVD player. They are giving you free DVDs to get you to buy the DVD player and are hoping that you will also need the cables for it as well. They may even try to upsell you on a home theater system too.

2013 Back to School Tax Holiday

You can find an updated list of back to school tax holidays by state by clicking on this link. For the most part, these holidays occur during the month of August. If you need to purchase back to school items for the upcoming school year, this is a great time to take advantage of. Here are a few tips:

Make a list – There is no point in going out during the holiday weekend and buying stuff you don’t need. Make a list of what you truly need and go from there.

Understand the Discount – The holiday is for sales tax, so in most cases you will save 5-8%. Again, don’t go crazy buying everything known to man. 5-8% off is nice, but you might get a better deal waiting later into the summer when stores start discounting more items.

Shop Around – All stores that carry the tax free items will deal with the holiday. So make sure you do your homework first so that you are getting the best deal. There is no point in spending $100 more at one retailer when another one has the same item for 10% less.

Understand the Rules – During the tax free holidays, some states will not allow you to use coupons during the weekend. It’s best to know this first so that you aren’t stuck buying a more expensive item than the retailer down the street.

Final Thoughts

If you are smart about the tax free holidays that states run, you can walk away saving a good amount of money. Many retailers will have sales going on at the time to encourage you to buy, but their best sales will be later in the year when they are bringing in the new models and getting rid of the old. At the end of the day, this is an easy way to save 5% on items that you need, regardless if you are shopping for school or not.