HF4750

Purpose

The bill would create a temporary sales tax holiday in July 2026 to celebrate the United States’ 250th anniversary. During that period, purchases of tangible personal property would be exempt from the state sales tax.

Main Provisions

• Exemption period: from 12:01 a.m. on July 1, 2026 through 11:59 p.m. on July 31, 2026.
• What is exempt: the sale of tangible personal property as defined in Minnesota Statutes section 297A.61 subdivision 10.
• What is not exempt: alcohol, taxable cannabis products, and motor vehicles are not covered by the exemption.
• Legal basis: the exemption is tied to Minnesota Statutes chapter 297A (sales tax).

Significant Changes to Existing Law

• Creates a temporary sales tax exemption (a sales tax holiday) for a defined one-month window in July 2026.
• Alters the application of the state sales tax by temporarily excluding most tangible personal property from tax during the specified period, while excluding specific items (alcohol, taxable cannabis products, motor vehicles) from the exemption.
• No lasting change to the current tax rate or base beyond the July 2026 window.

Practical Implications

• Shoppers could save money on many purchases of tangible personal property during July 2026.
• Retailers may see increased sales during the exemption period.
• State revenue from sales tax would be reduced for the duration of the exemption; normal tax collection resumes after July 31, 2026.

Relevant Terms - Sales tax holiday - Exemption - Tangible personal property - Minnesota Statutes chapter 297A - Minnesota Statutes 297A.61 subdivision 10 - July 1–July 31, 2026 - 12:01 a.m. July 1, 2026 to 11:59 p.m. July 31, 2026 - Alcohol - Taxable cannabis products - Motor vehicles