Tax-Free Insanity

tax-free graphicThe annual, three-day Sales Tax Holiday begins today in Texas.   During the "holiday" weekend of August 21—23rd, back-to-school shoppers get a break from state & local sales taxes on most clothing, shoes, backpacks, & school supplies priced at less than $100 purchased for use by a student in an elementary or secondary school.

Now don’t get me wrong, I’m all for being frugal and realize that even small savings can add up, but just as I wondered how did shopping become a holiday? a couple of years back, I continue to question this insanity.   There’s little doubt as to our government’s underlying motives for this "holiday" — oh sure, we get a little relief from sales taxes on a few select items, but they get a massive shot in the arm from the influx of taxes on incidental purchases — purchases we’d be much less likely to make if not for this artificial incentive.

And really, unless you’re spending hundreds of dollars, an eight percent savings isn’t a tremendous net.   (C’mon, we’re talking about less than a Frappuccino or two.)   In fact, I suspect that if instead of this pay no sales tax all weekend event, retailers advertised a take 8% off on back-to-school purchases sale, the response would be, um, "yawn."

Rapacious retailers are, of course, banking heavily upon this "holiday" to lure budget-crunched consumers into the stores and help pry open their wallets.   These annual sales tax holidays have become a huge event that extend, in many states, well beyond sensible school supplies to include big-ticket items like large electronics, major appliances, & furniture.

And the tax-free insanity doesn’t end there…

Some states also have separate sales tax holidays just for firearms.   Firearms?   Yup, you can get your weaponry & ammo tax-free in Louisiana on September 4—6th and in South Carolina on November 27—28th!
 

2 Comments

  1. I've never heard of these tax-free holidays before. We have a 6% state sales tax here in Michigan and they don't offer a tax-free period.

    You're right, an 8% discount isn't worth jumping up and down for but I bet a lot of lines are forming to get the break.

    I can't help but be a little skeptical, it's in my nature, especially when it comes to government. It seems like the government still gets paid. I could be wrong but if a lot of people respond to the state's 'generosity' then the stores profit more and pay more taxes into the coffers than they would on any other weekend. I wouldn't be surprised if Texas actually collects more tax revenue dollars by using the 'holiday'.

  2. Sometimes, just the idea of getting something for cheaper than you could before is an incentive. And people WILL be shopping for school stuff, so it's not like the money wasn't going to be spent anyway. Someone is getting paid, however . . .

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