Buy one, get one free or for a reduced price

5.1. The total price of items advertised as "buy one, get one free" or "buy one, get one for a reduced price" may not be averaged in order for both items to qualify for the exemption. The following examples illustrates application of this rule:

Example 1: A retailer advertises pants as "buy one, get one free." The first pair of pants is priced at $150.00; the second pair of pants is free. Tax is due on $150.00. The store cannot sell each pair at $75.00 in order for the items to qualify for the exemption. However, the retailer may advertise and sell the items for 50 percent off, selling each pair of $150.00 pants for $75.00, making each pair eligible for the exemption.

Example 2: A retailer advertises shoes as "buy one pair at the regular price, get a second pair for half price." The first pair of shoes is sold for $140.00; the second pair is sold for $70.00 (half price). Tax is due on the $140.00 shoes, but not on the $70.00 shoes. The store cannot sell each pair of shoes for $105.00 in order for the items to qualify for the exemption. However, a retailer may advertise each pair for 25 percent off, thereby selling each pair of $140.00 shoes for $105.00, making each pair eligible for the exemption.