On September 1, 2023, Texas SB 379 went into effect, making many medical, menstrual, maternity, and family care items exempt from sales tax.
Many wound care products are now tax exempt. The law exempts those products meant to treat and protect wounds, including adhesive bandages, sterile gauze and surgical or medical tape. It does not include general purpose items such as cotton balls or swabs, tissues, or items designed to drain or irrigate body cavities.
Feminine hygiene products have also been made tax exempt. This includes tangible personal property with the principal purpose of hygiene in relation to menstrual or post-partum care such as sanitary napkins, tampons, or menstrual cups, and items of similar purpose.
Tax exempt status was also extended to many products associated with family care. This includes breast pumps (including the power source/battery sold with the device and accessories such as tubing necessary to use the device), maternity clothing, and nursing bras. Baby bottles, baby wipes, and diapers (both children’s and adult) with no distinction for cloth/reusable or disposable are also included.
As more states pass similar legislation, sellers of these products need to be aware of the changes as well as the specific inclusions, exclusions, and definitions offered by individual states, such as Texas’ inclusion of both maternity clothes and nursing bras in this statute. Sellers should monitor their selling systems and ensure these products are properly categorized for sales tax purposes to ensure sales tax is not being charged when the products meet the exemption criteria contained in the law. This law, like many, does not affect any liability before the effective date, so any previous liability will still be assessed under the previous laws, which may lead to sellers owing tax on previous sales of these types of products. (Texas SB No. 379, effective September 1, 2023)