Tax free season is here in time for back to school shopping

COLUMBUS, Ohio — Thanks to a revised code in the Ohio state budget, consumers can shop tax free on a variety of items from July 30 until Aug. 8. 

The tax free holiday is what many consumers look forward to in order to prepare for back to school. This year, Ohioans have 10 days to shop rather than just a weekend, but the length of time isn’t the only change.

The tax exemption covers tangible personal property that is $500 or less, which is a significant increase from the $75 threshold in the past. 

The sales tax holiday also applies to restaurants. Although sales tax is not applied if you do drive-thru, carryout or delivery, it is applied to those who decide to dine in.

This tax free season might be a good time to try a new restaurant with friends and family, because you will not see a sales tax line on your final bill for menu items under $500. Items ordered online also qualify if placed during the allotted 10-day period, and this also includes tax on shipping and handling. 

While this is all great news for the consumer, counties might not be as thrilled. Ohio’s tax rate is only 5.75%, but on your receipt, you’ll notice that tax ranges from 6.75% to 8%. The extra one to 2.75% comes from your local county. During the tax free holiday, all taxes are exempt, including county.

an economics professor from The Ohio State University said the only way counties could make up for lost money is if they see a huge increase of new shoppers. 

“All these things could be offset if it set off this wave of purchases, in particular coming from out of state,” said Mark Partridge, an AED economics professor from The Ohio State University. “If we’re just getting sales that we would have got anyhow in Ohio from Ohio residents, then it’s no big deal, but if out-of-state residents along the border, say near Cincinnati and so forth, came over the border and shopped in Ohio because of the sales tax holiday, then that would be a really good thing.”

While Partridge and other economists don’t predict a lot of out-of-state travel for the holiday, he said that this tax break is an ode to the consumer so they know legislators understand that a break is needed.

Last year, many families had to spend more than they were used to on back-to-school items. According to the National Retail Federation, families with children in K-12 spent an average of about $890, which is $25 more compared to 2022. Families with college students saw a bigger jump, spending about $170 more in 2023 than in 2022, spending over $1,300. You can find a list of purchases that qualify for the tax free holiday here.