Since April 2011 cash-strapped Hudson Valley families have benefitted from the sales tax exemption on clothing and footwear that costs less than $55 per item. Prior to April 2011, the state levied a full sales tax of 4 percent from October 2010 to March 2011 to raise revenue amid its fiscal woes. The state made $330 million during the period. Then came the release of Technical Memorandum TSB-M-11(3)S which stated, “Chapter 57 of the Laws of 2010 amended the sales and use tax law to provide that clothing sold for less than $55 per item and footwear sold for less than $55 per pair will be exempt from the state’s sales and use taxes beginning April 1, 2011, and ending March 31, 2012.”
Many feared the full tax rate would go back into effect at the end of business on March 31st. The pleasant surprise is that April 1, 2012 is NOT April Fool’s Day for Hudson Valley families on a budget! The New York State Department of Taxation and Finance has announced the tax clothing exemption will be restored to the original less than $110 threshold. The theory is that sacrificing a few percentage points in sales taxes will encourage additional spending and give an overall boost to our local economies.
What does all of this mean to Hudson Valley families on a budget? Beginning this Sunday, clothing and footwear sold for less than $110 per item or pair are exempt from the New York State 4% sales tax, the local tax (if applicable), and the .375% Metropolitan Commuter Transportation District (MCTD) tax (if applicable). Happy shopping!