Alabama 2017 Back-to-School Sales Tax Holiday Comes Earlier Than Usual

Although kids might feel like summer vacation is just getting started, school will be back in session before they know it. Going back to school necessarily means going back-to-school shopping, which is why so many parents rely on the state sales tax holiday to save money. But parents should be aware that instead of being held on the first week of August, this year’s holiday will take place at the end of July.

According to the Alabama Retail Association, certain school supplies will be exempt from sales tax from midnight of July 21 until midnight of July 23. The items considered to be tax-exempt are clothing ($100 or less), school supplies ($50 or less), books ($30 or less), and computers and computer equipment ($750 or less). A full list of exempt items can be found on the Alabama Department of Revenue’s website.

2017’s tax-free weekend will be Alabama’s twelfth. The holiday’s move comes as a result of a new law passed this session, which officially shifted it from the third full weekend of July instead of the first full weekend of August.

A Tax Foundation study from 2016 revealed that the Yellowhammer State has the fourth highest combined sales tax rate in the country. The five states with the highest average combined state and local sales tax rates are Tennessee (9.46 percent), Arkansas (9.30 percent), Louisiana (9.0 percent), Alabama (8.97 percent), and Washington (8.90 percent).

Alabama only has a 4 percent statewide rate — good enough for twelfth lowest in the country. However, the state tax code allows for localities to tack on an additional 7 percent, which they do at an average of 4.97 percent.

Last year, Rosemary Elebash, the state director of the National Federation of Independent Business, noted that sales tax holidays work to benefit both the consumer and the larger economy. “The sales-tax holiday should help people get fired up and in the mood to spend,” she said. “Combined with the back-to-school sales a lot of stores are having, the sales-tax holiday is going to help people get a bigger bang for their buck.”