Skip to Content

Annual Sales Tax Holiday takes on new meaning this year

Remaining Ad Time Ad - 00:00

WATERLOO, Iowa (KWWL)- It is the annual sales tax holiday in Iowa this weekend. The tax break began on Friday and runs through midnight Saturday.

During the tax holiday, no sales tax is collected on clothes and shoes that cost less than $100.

The statewide sales tax is 6% but it could be as high as 8% depending on the municipality.

According to the Iowa Department of Revenue, sports equipment, athletic clothing, watches, and jewelry are among the items that are not exempt.

While the tax holiday is frequently billed as a back-to-school event, but common supplies like binders, notebooks, or calculators are also not a part of it.

At Palace Clothiers in Waterloo, it was a slow afternoon.

"Generally on Saturday's we do a lot of business early in the morning and then it tapers off," Manager Kevin Seng said.

Seng said the sales traffic he sees on tax free day varies from year to year.

"I don't really treat it like it is any other day," he said. "Some people come and take advantage of it and others don't."

This tax free day, in the midst of a pandemic and economic slowdown is different. Businesses throughout the Cedar Valley are looking for a jump start.

"Being closed for two months, that was a pretty tough deal," he said. "We would like to see more customers take advantage of it. That would be a good thing."

Seng said business has been steady over the past few weeks. Even with families choosing to have their kids go to school online this fall and adults continuing to work from home.

"The good news is there are a lot of people out there who fluctuate and need new clothing," he said.

Many clothing stores have taken added precautions to keep customers and employees safe.

Traditionally, people from surrounding states come to Iowa for the sales tax holiday.

Some states like Illinois and Wisconsin currently do not have any scheduled.

Author Profile Photo

Daniel Perreault


Skip to content