Is Sales Tax Taking a Break? New Rules on Sales Tax Holidays and Permanent Exemptions

Sales tax holidays and exemptions—once the realm of weekend “back-to-school” rushes—are being reshaped by many state legislatures across the country. In 2025 and beyond, states are shifting from occasional tax-free weekends to broader, longer, and in many cases permanent exemptions that reflect policy priorities like disaster preparedness, affordability of essential goods, and economic relief.

In this article, we break down how sales tax holidays and exemptions are evolving, what retailers should expect for the remainder of 2025-2026, and how remote sellers can stay compliant as these rules grow more complex.

Key Takeaways

• More states are expanding or extending tax-holiday programs, with some embedding them into permanent law.
• These holidays apply to online and remote retailers, not just brick-and-mortar shops.
• Permanent exemptions for essential goods are growing, especially groceries, baby products, and feminine hygiene items.
• Florida is leading the charge with a sweeping 2025 bill that makes its back-to-school holiday permanent, and exempts disaster-preparedness products and precious metals year-round.
• Several states are eliminating sales tax on gold, silver, and platinum bullion, creating new investment opportunities and compliance considerations.

Sales Tax Holidays

More States Are Expanding or Extending Tax Holidays

States are increasingly broadening their sales tax holidays, both in scope and duration. What used to be two-day events are becoming week-long and even months-long exemptions.

Florida is a standout: its new law makes the back-to-school holiday permanent and expands it to run the entire month of August every year. Legislation also introduced a hunting, fishing, and camping gear holiday that runs nearly four months, from September 8-December 31, 2025.

Ohio also broadened sales tax relief in 2025. From August 1-August 14, Ohio exempted almost all tangible personal property priced at $500 or less, and new legislation ensures that the same holiday will run year after year.

These expansions signal a clear trend: tax holidays are no longer niche events tied to school shopping. Rather, they’re becoming broader tax-relief strategies.

Tax Holidays Apply to Online Retailers as Well as Local Shops

A frequent question retailers ask: Do tax holidays apply to online sales?

Yes—usually. Most states require both local and remote sellers to participate. That means e-commerce businesses must:

• Ensure tax-calculation engines recognize holiday-eligible SKUs
• Follow state-specific rules on order timing (i.e., order date vs. ship date)
• Observe price thresholds and category limitations

That said, there are exceptions. New Mexico, for example, does not require seller participation in their gross receipts tax holiday. However, more states are moving toward mandatory participation in recent years, so it is generally safe to assume that if a state you sell in is hosting a sales tax holiday, you’ll need to exempt those items.

Some States Have Holidays as Annual Fixtures

Unlike spontaneous tax-free weekends, some states have enacted permanent or annual holidays that persist unless legislation changes. Some examples include:

• Florida: Permanent back-to-school holiday every August
• Arkansas: Annual back-to-school holiday each August
• Connecticut: Annual tax-free week on clothing and footwear
• Maryland: Annual Shop Maryland Energy Weekend in February on qualifying energy-efficient products

These long-term and recurring exemptions significantly change how businesses must think about sales tax and product mapping.

Common Categories Covered: Back-to-School, Disaster-Prep, and Electronics

While every state is different, sales tax holidays typically focus on:

• Back-to-school items: Clothing, school supplies, learning aids, backpacks, and personal computers or accessories (when under specific price thresholds).
• Disaster-preparedness gear: Batteries, portable generators, tarps, tie-down kits, and ground-anchor systems.
• Electronics: Laptops, monitors, printers, and accessories (usually with consumer-use restrictions).

These categories are often a reflection of both consumer demand and state policy goals, like reducing the cost of education, improving household safety, and increasing access to technology.

Permanent Exemptions

States Axing Tax on Essential Goods

Beyond temporary holidays, more states are eliminating sales tax on everyday necessities. Here are some recent examples:

• Florida (2025): As of August 1, 2025, permanent exemptions cover items like batteries, smoke detectors, fire extinguishers, CO detectors, life jackets, sunscreen, insect repellent, and state park admissions.
• Oklahoma (2024): Oklahoma removed it 4.5% state sales tax from groceries August 29, 2024. Local taxes still apply.
• Illinois (2026): Effective January 1, 2026, Illinois will eliminate its 1% sales and use tax on groceries. Local municipalities and counties will still be allowed to impose a maximum 1% rate.
• Missouri (2025): Sales tax was removed from child and adult diapers, qualifying feminine hygiene products, and incontinence products on August 28, 2025.
• Kansas (2025): Effective January 1, 2025, Kansas Legislature eliminated sales tax on groceries, including food, food ingredients, and certain prepared foods. Local taxes may still apply

These changes reflect a broader policy trend: legislators increasingly view these as essential goods, not optional luxury items.

Bullion Exemptions: What’s Happening with Gold, Silver & Platinum

Beyond essential goods, another major event is brewing in sales tax exemptions. A few states are beginning to exempt gold, silver, and other small bullion purchases from sales tax:

• Ever the trend-setter, Florida continued to sweep sales tax news in 2025 with another permanent exemption: all qualifying bullion (coins, bars, rounds) of gold, silver, and platinum, irrespective of unit value, are now sales tax exempt.
• Kentucky vetoed a bill on March 25, 2025, thereby exempting bullion and currency from sales tax.
• Beginning January 1, 2025, New Jersey enacted a sales tax exemption on investment metal bullion and coins valued at $1,000 or more.

Many states already exempt high-purity bullion or legal-tender coins, but these new laws are expanding access and lowering purchase thresholds. For online bullion dealers and marketplaces, the compliance stakes are high: misclassification or missed exemptions can result in costly corrections down the line.

Predicting the Road Ahead: How Exemption Laws May Continue to Evolve

• More states may follow in creating permanent exemptions, particularly for disaster-preparedness products and safety gear.
• Essential goods (groceries, baby products, feminine hygiene) will receive broader permanent relief, as consumer advocates and legislators push for “necessities not luxuries” tax treatment.
• Precious metal exemptions may expand—both in terms of metal types and value—driven by investment demand and states’ interest in attracting bullion business.
• Tax engines will need to adapt to increased complexity and be capable of keeping up with changing tax laws.
• Heightened audit activity, especially around SKU categorization and tax holiday compliance.

Simplify Compliance with SalesTaxSolutions.US

Keeping up with shifting tax holidays and permanent exemptions can be like a second full-time job.

Let SalesTaxSolutions.US handle it for you.

With our Tiered service plans, we manage:

• State registrations and nexus monitoring
• Notice handling and audit defense
• Filing and remittance in every state you sell into

Conclusion

Sales tax holidays and exemptions are no longer simple weekend promotions; they’re becoming long-term policy tools that impact millions of online transactions. As states expand permanent exemptions and redefine what counts as “essential”, remote retailers must stay agile.

With the right systems and the right tax partner, you can stay compliant, reduce risk, and focus on scaling your business for the future.