Iowa’s annual two-day sales tax “holiday” is this Friday and Saturday.
Carol Ehlers, an Iowa State University Extension Health and Human Sciences educator, says parents can get a meaningful break in their back-to-school shopping. “The tax exemption applies to clothing under $100 and shoes under $100,” Ehlers says. “It gives the shopper a discount of between 6% to 7%, depending on the community.” That’s because shoppers will not pay the state sales tax or any local option sales taxes on those items.
Ehlers recommends that parents take an inventory of what children already have, what they need for the school year, set a budget and stick to it. Ehlers says the process can show kids the difference between needs and wants.
“If there’s a difference between what you have available to spend on each child and what you’ve identified as a need, ask them: ‘What could we do that might be different? Is there some money that you might want to match so that you can have whatever it is that you’re wanting on your list?’” Ehlers says. “Having these great money conversations — that’s how we build financial literacy and a deeper understanding about money.”
The Iowa Department of Revenue has a long list of things that are exempt from sales taxes during this two-day period, as well as items that will still be taxed. Iowa’s annual sales tax holiday kicks off Friday at 12:01 A-M on Friday and runs through midnight on Saturday.
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