Things to know about the MA sales tax holiday.
Things to know:
Participation – All Massachusetts businesses normally making taxable sales of tangible personal property that are open on August 12 and August 13, 2023 must participate in this sales tax holiday.
Purchases qualifying for the exemption -The exemption applies to sales of tangible personal property bought for PERSONAL USE ONLY. Purchases by corporations or other businesses and purchases by individuals for business use remain taxable. Eligible items of tangible personal property purchased on the Massachusetts sales tax holiday from out-of-state retailers for use Massachusetts are exempt from the Massachusetts use tax.
Specific Rules:
The following rules are to be applied by retailers in administering the Massachusetts sales tax holiday exemption:
- Non-Exempt Sales – all sales of motor vehicles, boats, meals, telecommunications services, gas, steam, electricity, and of any single item whose price is in excess of $2,500, do not qualify for the sales tax holiday exemption and remain subject to tax.
- Threshold – When the sales price of any single item is greater than $2,500, sales or use tax is due on the entire price charged for the item. the sales price is not reduced by the threshold amount. For Instance, if an item us sold for $3,000, the entire sales price of the item is taxable, not just the amount that exceeds $2,500.
Previous Sales – You can’t cancel your prior purchase and re-book the purchase on the sales tax holiday weekend to avoid the sales tax if you:
- put down a deposit on,
- prepaid for or otherwise promised to pay for an eligible item prior to the sales tax holiday weekend.
Bundled Transactions – When several items are offered for sale at a single price, the entire package is exempt if the sale price of the package is $2,500 or less.
Exchanges – Consistent with the department’s usual practice, if a customer purchases an item of eligible property during the sales tax holiday, but later exchanges the item for an identical or similar eligible item, for the same price (“an even exchange”) , no tax is due even if the exchange is made after the sales tax holiday.
Order Date and Back Orders – for purposes of the sales tax holiday, property qualifies for the exemption if the customer orders and pays for the item during the sales tax holiday, even if delivery id made thereafter.
Splitting of items normally sold together – Articles normally sold as a single unit must continue to be sold in that manner. Such articles cannot be priced separately and sold as individual items in order to obtain the sales tax holiday exemption.
Returns – For a 90-day period immediately after the sales tax holiday, when a customer returns an item that would qualify for the sales tax holiday exemption, no credit for or refund of sales tax will be given unless the customer provides a receipt or invoice that shows tax was paid, or the seller sufficient documentation to show that tax was mistakenly charged on the specific item.
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