Friday, August 05, 2005

This Makes Us Smile: Back-To-School Sales Tax Holidays

For the next few weeks, parents in several different areas of the country will be able to purchase a variety of back to school items without having to pay sales tax:
While many students shudder at the onset of the back-to-school season, parents have reason to smile, as it signals the start of the tax holidays.

In the coming weeks, 11 states and the District of Columbia will offer periods of sales tax exemptions, according to CCH Tax & Accounting.

Those few days of tax freedom mean consumers can save a few bucks on everything from clothing and footwear to school supplies and computers.

"It has a lot of appeal," said Daniel Schibley, the state tax news director for CCH. "Retailers like it because they think it will bring more people into the stores; politicians like it because they are giving a tax cut; and parents think it's a great thing that they're saving money."

Maryland and Tennessee, not participating this year, are planning tax holidays in 2006, while Michigan is considering its own version.

Vermont and West Virginia are not granting any breaks this year after offering programs last year.

The tax-amnesty trend, which New York initiated in 1997, does not always deliver results for retailers.

This year the National Retail Federation anticipates that sales in the back-to-school shopping period, which typically covers all of August, will fall by 8 percent from the same period in 2004.
Consider taking a look at the entire article for a list of states, dates, and overview of items exempted from taxation.

Many states have complete online lists of what items are exempted, some of which are humorous to read. Here is the State of South Carolina's
official list (scroll down two pages) of exempt and non-exempt items, a few of which we give below.

During the next 3 days only South Carolina exempts traditional school-related articles such as shoes, clothing, computers, and classroom supplies as well as such non-traditional "school-related" items, (each of which is specifically listed) such as: adult diapers, corset laces, fishing boots, formal clothing, (sold, not rented) garters and garter belts, ice skates, (!) ski boots, ski suits, (snow only) and lingerie.

In what kind of school would students (or teachers?) need garter belts and lingerie? I can't help but wonder...

According to the official state list, golf clubs and eyeglasses are not exempted from sales taxes, and neither are rented tuxedos and prom dresses.

Sadly, our home state of California has never had such a back-to-school "tax holiday," although we do have all types of (usually high) taxes.

Sales taxes are about the most
regressive kinds of taxes there are. As a classroom teacher, how can I not like a concept that gives all parents a break on preparing their children to return to school? The idea of a back-to-school sales tax holiday (at least for traditional back-to-school items) is an idea whose nation-wide implementation is long overdue.
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