Shoppers in fourteen states prepare for sales tax holidays

Residents of at least fourteen states and the District of Columbia can look forward to purchasing clothing, school supplies, and computers within certain price limits without having to pay state sales tax during tax holidays next month. Anyone can take advantage of the tax breaks, but the sales are intended to coincide with the re-opening of schools.

The National Retail Federation estimates that the average family with school-age children will spend $563.49 this year on back-to-school supplies and clothing. In North Carolina that translates into a $40 savings after tax breaks, News 14 in Raleigh reports.

"I think taxpayers really appreciate it," said Kim Brooks from the North Carolina Department of Revenue. "If they're like me, I like to shop and I also like to save money, so I think people appreciate it."

Tax holidays are scheduled on the first weekend of August in eleven states: Alabama, Georgia, Iowa, Missouri, New Mexico, North Carolina, South Carolina, Tennessee, and Virginia and, for the first time, Louisiana and Oklahoma. Louisiana has enacted a broad-based holiday during which the first $2,500 of the price of most items of tangible personal property is exempt from sales tax. Texas has put off the tax-free weekend until August 19 this year.

Florida, Connecticut, and the District of Columbia will extend their tax-free holidays to an entire week. For Florida and D.C., the holiday begins August 4. Connecticut has scheduled the sales tax holiday for the week of August 19 through 25.

County and local taxes will be waived for the same period in many states. In Alabama, where local sales taxes can account for half of the total sales tax, 200 cities and counties will waive sales taxes for the tax-free weekend of August 3 through 5, according to the Brewton Standard .

Sales tax holidays are popular with retailers as well as shoppers, because the back-to-school season helps them determine what will be big sellers during the winter season, Jorge Rico, manager for Mevyns in El Paso told the El Paso Times. The sales tax holiday also helps retailers anticipate winter holiday staffing needs. In terms of sales, the tax-free weekend, is "huge," Rico said, comparable to Thanksgiving.

New Mexico does not require retailers to participate in the sales tax waiver, and Missouri does not require retailers to participate if less than 2 percent of their merchandise qualifies for the exemption. States also have different requirements for reporting the exemption, and retailers should consult their state's web site for details.

Families are expected to spend 13 percent more on electronics this year, according to the National Retail Federation. Two-thirds of families plan to shop in discount stores. This represents a decline of approximately 5 percent from last year, when 72.2 percent said they shopped at discounters.

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