We got an email recently from Bin D. questioning whether she had been wrongfully charged sales tax by REI on a biking jacket she bought for her husband.
In Massachusetts, clothing and footwear up to $175 is free of sales tax year-round. Lucky us. Otherwise the sales tax is 6.25-percent. But our unlucky consumer was charged tax anyway.
She questioned the erroneous charge three times with REI, particularly after realizing that other sellers did not charge tax on this jacket. Here is their response:
We will not provide a refund of tax for this order. This is a sports specific jacket and as a result tax levied is correct. The clothing tax exemption does not apply to clothing and footwear that are primarily designed and used for athletic activities or for protective use and that are normally [not] worn except for such purposes.
We asked Boston’s ace consumer reporter at WCVB, Ben Simmoneau, to take on the case and hopefully get REI to stop charging sales tax on exempt items like that jacket.
Well, despite the TV news story, the company continues to buck the system not fully understanding the Massachusetts tax law.
The actual statute, MGL. c. 64H, Sec. 6 provides:
*MOUSE PRINT:
(k) Sales of articles of clothing, including footwear, intended to be worn or carried on or about the human body up to one hundred and seventy-five dollars of the sales price on any article of clothing. For the purposes of this section clothing or footwear shall not include special clothing or footwear primarily designed for athletic activity or protective use and which is not normally worn except when so used.
The Massachusetts Department of Revenue explains the law in plain English:
Tax Exempt:
… jackets, windbreakers
While apparel designed solely for athletic or protective use is taxable, items that are also suitable for everyday use are exempt.
Taxable:
… athetic uniforms (baseball, football, etc.), Clothing primarily designed to protect from physical injury…
In our view, there is nothing about this jacket that would make it unsuitable for everyday wearing, and just because a manufacturer decides to market it as a “cycle jacket” doesn’t limit its use because of its design, looks, or functionality.
We think REI is incorrectly applying the law in this case.