Massachusetts sales tax holiday weekend 2017

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Massachusetts shoppers and retailers are prepping for what has become an August ritual: the state’s annual sales tax holiday set to run this year on Saturday and Sunday.

For businesses, the tax-free weekend means a spurt of business in what can be a slow time when most people are out enjoying summer instead of shopping.

“It’s good and bad,” said Manny Rovithis , owner of Manny’s TV & Appliance locations in Western Massachusetts. Good because the tax-free weekend stimulates spending. Bad because it concentrates about a month’s worth of business on one weekend. His salesmen get to work at 5:30 a.m. to start processing orders. He ends up hiring extra employees to make deliveries.

Gary Okun, owner of Beautiful Roomsfurniture store in West Springfield, said he makes sure his showroom is full heading into tax free weekend and he make s sure there are plenty of designers and sales staff around to help customers out. Upholstery sells strongly, he said. But some people do buy dressers and the like.

“It’s a once-in-a-year offer,” he said. “Some people even wait for it.”

What it means

The state’s 6.25 percent sales tax is suspended on most purchases of less than $2,500. See our handy cheat sheet below to see how much you’d save on purchases ranging from $50 to $2,499.

What items will still be taxable?

Anything costing more than $2,500, according to the state Department of Revenue. That means if an item costs $2,600, the consumer pays the tax.

What about clothing?

There is no Massachusetts sales tax on any article of clothing unless the sales price exceeds $175. It it exceeds $175, only the increment over $175 is subject to tax. If the price of an article of clothing exceeds the threshold, the first $175 may be deducted from the amount subject to tax. The $2,500 threshold amount is not increased by $175.

A clothing example?

A) A customer buys a suit on the sales tax holiday for $600. No tax is due.

B) A customer buys a wedding dress on the sales tax holiday for $2,550.  Tax is due on $2,375 ($2,550 – $175).

Breaking up items:

Retailers are told not to split up items normally sold as a set. No calling a $3,000 suit a $1,500 coat and $1,500 pants to beat the tax, the state says.

What about cars, boats, motorcycles, etc.?

The exemption doesn’t apply to: all motor vehicles, motorboats, motorcycles etc. Pretty much anything you have to register doesn’t count and is taxed.

What else isn’t part of the holiday and thus is taxable?

Meals, telecommunications services, gas, steam, electricity, tobacco.

Is now the time to buy those Apple products you’ve been thinking about?

Mark Wineburg, owner of  Yes Computer in Northampton, an Apple retailer, said that the tax-free weekend is his busiest time of the year.

“Christmas doesn’t hold a candle to it,” he said, adding that he thinks it’s one of the best business decisions that state has ever made.

He said pre-ording on computers and devices is strong.

“This has been even better than the previous six years,” he said.

For his business, the tax-free weekend comes as consumers are preparing to go back to school or at least winding down summer fun.

“They are basically back in gear,” he said.

What about Connecticut?

Connecticut has a tax-free week the third week of Aug. 16 through Aug. 22. It applies to clothing and footwear costing less than $100, according to Nutmeg state officials.