Ohio is set to bring back its Expanded Sales Tax Holiday from August 1 to 14, 2025, offering consumers a chance to shop for various goods without paying sales tax.
This event, which starts at midnight on August 1 and ends at 11:59 PM on August 14, applies to eligible items priced at $500 or less. Ohioans will be able to purchase back-to-school supplies, electronics, clothing, and more without the added cost of tax.
According to The Sun, this tax holiday aims to provide savings to consumers, though both buyers and sellers must adhere to specific guidelines throughout the event.
What’s Tax-Free During Ohio’s Sales Tax Holiday?
Under Ohio’s tax holiday, a variety of goods will be exempt from sales tax, provided they are priced under $500.
These include school supplies such as books and notebooks, electronics like computers and televisions, and most clothing items. The Ohio Department of Taxation emphasized that these are just examples, adding that
Many other items will also be exempt from sales tax during this period.
For families preparing for the school year, this is a prime time to make tax-free purchases. Additionally, items like furniture, sports equipment, and kitchenware are also eligible, offering savings across multiple categories.
Exclusions to Keep in Mind
Not everything is eligible for the tax break. The Ohio Department of Taxation clearly lists exclusions, such as alcoholic beverages, motor vehicles, items containing marijuana, tobacco products, vapor products, and watercraft or outboard motors.
These exclusions are crucial for consumers and businesses to note in order to avoid unexpected costs.
Understanding these limitations ensures shoppers are not surprised at checkout.
What Sellers Need to Know
Sellers across Ohio must be diligent in following the rules laid out by the Ohio Department of Taxation.
For example, if a customer purchases both exempt and non-exempt items, the tax must be applied to the entire price of the non-exempt items. The Ohio Department of Taxation explained:
“If exempt and non-exempt items are sold together as a unit, the entire price will be subject to sales tax.”
Additionally, businesses are prohibited from separating items that are typically sold as a unit, even if some of the items qualify for the tax break.
Managing the Tax Holiday for Online Sales
For online retailers, the tax holiday presents additional complexities. If an online order includes both tax-exempt and taxable items, the seller must allocate sales tax based on
“The total price of the taxable items to the total price of all the items in the shipment.”
as per the Ohio Department of Taxation. While shipping fees for tax-exempt items are not taxable, businesses must allocate shipping costs proportionally when taxable and non-taxable items are included in the same shipment. The Ohio Department of Taxation stated:
“The retailer must charge tax on the portion of the shipping and handling charges allocated to the taxable items in the shipment.”
Sellers must ensure that their systems are properly configured to handle these nuances, especially as shoppers flock to online platforms for convenience.
