Session of 2023
SENATE BILL No. 29
By Senators Peck, Bowers, Claeys, Doll, Faust-Goudeau and Petersen
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AN ACT concerning sales taxation; relating to exemptions; providing an
exemption for sales of school supplies, personal computers and
clothing during an annual sales tax holiday.
Be it enacted by the Legislature of the State of Kansas:
Section 1. (a) On and after July 1, 2023, the following shall be
exempt from the tax imposed by the Kansas retailers' sales tax act: All
back-to-school-related sales of clothing, clothing accessories or
equipment, school supplies, school instructional materials, school art
supplies, prewritten computer software, personal computers and school
computer supplies during the period beginning at 12:01 a.m. on the first
Thursday in August and ending at midnight on the Sunday following. The
seller of items specified in this subsection shall not be required to obtain
an exemption certificate from the purchaser of such items as provided
pursuant to K.S.A. 79-3692, and amendments thereto, during the period of
time specified in this subsection.
(b) As used in this section:
(1) "Clothing" means all human wearing apparel suitable for general
use. "Clothing" includes, but is not limited to: Aprons, household and
shop; athletic supporters; bathing suits and caps; beach capes and coats;
belts and suspenders; boots; coats and jackets; costumes; ear muffs;
footlets; formal wear; garters and garter belts; girdles; gloves and mittens
for general use; hats and caps; hosiery; insoles for shoes; lab coats;
neckties; overshoes; pantyhose; rainwear; rubber pants; sandals; scarves;
shoes and shoe laces; slippers; sneakers; socks and stockings; steel-toed
shoes; underwear; and uniforms, athletic and non-athletic. "Clothing" does
not include: Belt buckles sold separately; costume masks sold separately;
patches and emblems sold separately; sewing equipment and supplies
including, but not limited to, knitting needles, patterns, pins, sewing
machines, sewing needles, tape measures and thimbles; and sewing
materials that become part of clothing including, but not limited to,
buttons, fabric, lace, thread, yarn and zippers;
(2) "clothing accessories or equipment" means incidental items worn
on the person or in conjunction with clothing. "Clothing accessories or
equipment" includes, but is not limited to: Briefcases; hair notions,
including, but not limited to, barrettes, hair bows, and hair nets; handbags;
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handkerchiefs; sunglasses, non-prescription; wallets; watches and wigs
and hair pieces;
(3) "eligible property" means an item of a type, such as clothing, that
qualifies for the sales tax exemption as provided in this section;
(4) "layaway sale" means a transaction in which property is set aside
for future delivery to a customer who makes a deposit, agrees to pay the
balance of the purchase over a period of time and, at the end of the
payment period, receives the property. An order is accepted for layaway by
the seller when the seller removes the property from normal inventory or
clearly identifies the property as sold to the purchaser;
(5) "rain check" means the seller allows a customer to purchase an
item at a certain price at a later time because the particular item was out of
stock;
(6) "school art supply" means an item commonly used by a student in
a course of study for artwork. The following is an all-inclusive list: Clay
and glazes; paints, acrylic, tempera and oil; paintbrushes for artwork;
sketch and drawing pads; and watercolors;
(7) "school computer supply" means an item commonly used by a
student in a course of study in which a computer is used. The following is
an all-inclusive list: Computer storage media, diskettes, compact disks;
handheld electronic schedulers, except devices that are cellular phones;
personal digital assistants, except devices that are cellular phones;
computer printers; and printer supplies for computers, printer paper and
printer ink;
(8) "school instructional material" means written material commonly
used by a student in a course of study as a reference and to learn the
subject being taught. The following is an all-inclusive list: Reference
books; reference maps and globes; textbooks; and workbooks; and
(9) "school supply" means an item commonly used by a student in a
course of study. The following is an all-inclusive list: Binders; book bags;
calculators; cellophane tape; compasses; composition books; crayons;
erasers; folders, expandable, pocket, plastic and manila; glue, paste and
paste sticks; highlighters; index cards; index card boxes; legal pads; lunch
boxes; markers; notebooks; paper; loose leaf ruled notebook paper, copy
paper, graph paper, tracing paper, manila paper, colored paper, poster
board and construction paper; pencil boxes and other school supply boxes;
pencil sharpeners; pencils; pens; protractors; rulers; scissors; wipe boards;
wipe board markers; and writing tablets.
(c) The secretary of revenue shall provide notice of the exemption
period to retailers at least 60 days prior to the first day of the calendar
month in which the exemption period established in this section
commences.
(d) The following procedures are to be used in administering the
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exemption as provided in this section:
(1) A sale of eligible property under a layaway sale qualifies for the
exemption if:
(A) Final payment on a layaway order is made by, and the property is
given to, the purchaser during the exemption period; or
(B) the purchaser selects the property and the retailer accepts the
order for the item during the exemption period for immediate delivery
upon full payment, even if delivery is made after the exemption period;
(2) there shall be no change during the period of exemption for the
handling of a bundled sale as treated for sales tax purposes at times other
than the exemption period;
(3) a discount by the seller reduces the sales price of the property. A
coupon that reduces the sales price is treated as a discount if the seller is
not reimbursed for the coupon amount by a third party. If a discount
applies to the total amount paid by a purchaser rather than to the sales
price of a particular item and the purchaser has purchased both eligible
property and taxable property, the seller shall allocate the discount based
on the total sales prices of the taxable property compared to the total sales
prices of all property sold in that same transaction;
(4) articles that are normally sold as a single unit shall continue to be
sold in that manner. Such articles cannot be priced separately and sold as
individual items in order to obtain the exemption;
(5) a rain check allows a customer to purchase an item at a certain
price at a later time because the particular item was out of stock. Eligible
property that customers purchase during the exemption period with use of
a rain check will qualify for the exemption regardless of when the rain
check was issued. Issuance of a rain check during the exemption period
shall not qualify eligible property for the exemption if the property is
actually purchased after the exemption period;
(6) the procedure for an exchange in regards to an exemption is as
follows:
(A) If a customer purchases an item of eligible property during the
exemption period, but later exchanges the item for a similar eligible item,
even if a different size, different color or other feature, no additional tax is
due even if the exchange is made after the exemption period;
(B) if a customer purchases an item of eligible property during the
exemption period, but after the exemption period has ended, the customer
returns the item and receives credit on the purchase of a different item, the
appropriate sales tax is due on the sale of the new item; and
(C) if a customer purchases an item of eligible property before the
exemption period, but during the exemption period the customer returns
the item and receives credit on the purchase of a different item of eligible
property, no sales tax is due on the sale of the new item if the new item is
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purchased during the exemption period;
(7) for the purpose of an exemption, eligible property qualifies for the
exemption if:
(A) The item is both delivered to and paid for by the customer during
the exemption period; or
(B) the customer orders and pays for the item and the seller accepts
the order during the exemption period for immediate shipment, even if
delivery is made after the exemption period. The seller accepts an order
when the seller has taken action to fill the order for immediate shipment.
Actions to fill an order include placement of an in date stamp on a mail
order or assignment of an order number to a telephone order. An order is
for immediate shipment when the customer does not request delayed
shipment. An order is for immediate shipment, notwithstanding that the
shipment may be delayed because of a backlog of orders or because stock
is currently unavailable to, or on back order by, the seller;
(8) for a 60-day period immediately after the exemption period, when
a customer returns an item that would qualify for the exemption, no credit
for or refund of sales tax shall be given unless the customer provides a
receipt or invoice that shows tax was paid or the seller has sufficient
documentation to show that tax was paid on the specific item. This 60-day
period is set solely for the purpose of designating a time period during
which the customer must provide documentation that shows that sales tax
was paid on returned merchandise. The 60-day period is not intended to
change a seller's policy on the time period during which the seller will
accept returns; and
(9) the time zone of the seller's location determines the authorized
time period for a sales tax holiday when the purchaser is located in one
time zone and a seller is located in another.
(e) The provisions of this section shall be a part of and supplemental
to the Kansas retailers' sales tax act.
Sec. 2. This act shall take effect and be in force from and after its
publication in the Kansas register.
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