Ohio Sales Tax Holiday: What Small Business Owners Need to Know

Sue Schloemer

Jul 25, 2024

Ohio’s 2024 sales tax holiday is an opportunity for small business owners to attract more customers and boost sales. This year, the annual sales tax holiday has been extended from July 30 to August 8 and now includes on-premises restaurant sales for the first time!

Quick facts to know:

Mandatory Participation: All eligible businesses must participate in the sales tax holiday. This is not optional.
Advertising: You are allowed and encouraged to advertise the sales tax holiday to attract more customers.
Eligible Purchases: The tax holiday applies to all tangible personal property priced at $500 or less per item. The total bill amount does not matter; only items priced over $500 are subject to taxes.
Exclusions: Certain items remain taxable, including alcoholic beverages, tobacco, marijuana products, motor vehicles, watercraft, and services like car repairs or clothing alterations.
Restaurant Meals: Food consumed while dining in is tax-free during the holiday. However, carry-out and delivery orders are not included.
Business-to-Business Sales: These are also exempt from sales tax during the holiday.
Reporting Requirements: Items sold during the tax holiday must be reported on the UST-1 form. Use Line 1 for all sales and Line 2 for tax-exempt sales.

Tips for Implementation

Update Systems: Ensure your point-of-sale systems reflect the new tax exemptions, especially for restaurants.
Train Staff: Make sure your team is aware of the new rules and how to handle exceptions like alcoholic beverages.
Promote Early: Use newsletters, social media, and in-store signage to inform your customers about the tax holiday and the savings they can enjoy.

For a full list of details and FAQs, visit the Ohio Department of Taxation’s FAQ.