State Sales Tax Holiday

              Effective August 6, 2010, through
August 15, 2010, a state sales tax holiday
will be implemented and certain items
purchased during this time period will have
a reduced sales tax rate. The sales tax rate
you will be required to collect during the
holiday period is the rate currently in effect
on the date of the holiday minus 5 percent.
For example:
If your sales tax rate is: 9.750%
Reduced amount (state portion) - 5.000%
Your sales tax rate during the
holiday period is: 4.750%
If your sales tax rate is: 6.250%
Reduced amount (state portion) - 5.000%
Your sales tax rate during the
holiday period is: 1.250%
What is a state sales tax holiday?
A state sales tax holiday is a 10-day
period during which consumers can
purchase certain items and pay sales tax
at a reduced rate. Items include qualifying
clothing and footwear with a retail selling
price of less than $100 and certain school
supplies used by students in the course of
study. School supplies are not subject to
the $100 threshold.
For a list of qualifying and non-qualifying
items, see Page 3.
How does this affect me as a retailer?
You must adjust your method of collecting
sales tax so that beginning on August 6,
2010, and ending at the close of business
August 15, 2010, you will collect the
reduced tax rate on qualifying items.
State Sales Tax Holiday
To: All retailers
For information
or forms...
Call us at:
1 800 732-8866 or
217 782-3336
Call our TDD
(telecommunications device
for the deaf) at:
1 800 544-5304
Write us at:
Illinois Department of Revenue
P.O. Box 19044
Springfi eld, IL 62794-9044
Visit our web site at:
tax.illinois.gov
Call our 24-hour
Forms Order Line at:
1 800 356-6302
This bulletin is written to
inform you of recent changes;
it does not replace statutes,
rules and regulations, or court
decisions.
Illinois Department of Revenue
Informational Bulletin
Printed by authority of the State of Illinois
344,0000 copies -6/10 -P.O. Number 2100707
FY 2010-17
June 2010
Brian Hamer
Director of Revenue
How do I report these sales on my
Form ST-1, Sales and Use Tax Return?
Taxable receipts from the sale of qualifying
items made during the state sales tax
holiday must be reported on Lines 8a and 8b.
How do I handle special sales?
Coupons and discounts
To determine whether the eligible clothing
item’s retail selling price is below $100,
look at the price after the unreimbursed
coupon or store markdown but before a
reimbursed coupon.
Bundled sales
Qualifying items bundled with items that do
not qualify for the state sales tax holiday
rate will be subject to the reduced tax rate
only if the value of the qualifying items
exceed the value of the non-qualifying
items.
Splitting items
Articles normally sold as a single unit must
continue to be sold as such to determine
whether the selling price is within the
state sales tax holiday price threshold. For
example, a pair of shoes with a selling
price of $125.00 cannot be sold separately
so the sales price of each shoe is within
the sales tax holiday price threshold.
Rain checks
Qualifying items purchased during the
holiday with a rain check issued prior to the
state sales tax holiday will qualify for the
reduced sales tax rate. Qualifying items
purchased after the state sales tax holiday
with rain checks issued during the holiday
are not eligible for the reduced tax rate.