Save on Moving, Packing, and Organizing Supplies During Sales Tax Holidays

Several states have instituted sales tax holidays this August, to give families a break while shopping for school supplies and to stimulate local economies. Many retail stores are offering special deals to coincide with tax-free days. Although the tax holidays are intended for back to school shoppers, many packing and organizing supplies, such as strapping tape and file folders, will be tax-free as well. People who are thinking of moving their files into storage, or decluttering a home in preparation for putting it on the market, may want to take advantage of the August tax-free holidays.

The states that will have tax holidays include:

• Alabama, where the tax holiday started Friday and continues through Sunday.
• Connecticut, which offers a holiday next weekend, from Aug. 15-21.
• Florida, which is offering a holiday from its six percent sales tax next weekend (from Aug. 13-15). Florida’s tax holiday will cover clothing and accessories under $50 and school supplies that sell for $10 or less.
• Illinois, which is waiving its five percent sales tax on school supplies and most clothing (under $100) for ten days (through August 15), starting Friday. Although Illinois is waiving its state sales tax, it will still collect a 1.25 percent tax which goes to counties and towns, as well as any local city taxes that may apply. The event is Illinois’ first ever tax holiday, and is being offered even though the state has a record-breaking $13 billion budget deficit.
• Iowa, where the tax holiday started today and continues through Saturday.
• Louisiana, where the tax holiday started today and continues through Saturday.
• Maryland, which starts its tax holiday this Sunday and will run it until next Saturday. The holiday will apply to clothes and shoes under $100, which in Maryland is a six percent discount.
• Massachusetts, which will have its tax holiday next weekend, August 14 and 15. The holiday will save shoppers a 6.25 percent sales tax. Last year, Massachusetts skipped its tax holiday because of state budget problems.
• Missouri, which will have a tax-free weekend running this Saturday and Sunday. The holiday applies to school supplies (under $50 per purchase), clothing under $100, and computers under $3500. A few shopping centers in Missouri, such as St. Louis Mills, will be completely tax free, since some localities are waiving local sales taxes as well.
• New Mexico, where the tax holiday starts today and continues through Sunday.
• North Carolina, which is offering the nation’s most generous tax holiday this weekend. North Carolina is waiving its 5.75 percent sales tax not only on school supplies, but also on computers under $3,500, computer equipment under $250, and instructional materials under $300.
• Oklahoma, where the tax holiday started today and continues through Sunday.
• Tennessee, where the tax holiday started today and continues through Sunday.
• Texas, which is offering a sales tax holiday from August 20-22. Texas’ holiday will apply to most clothing and shoes under $100, backpacks under $100, and school supplies under $100.
• Virginia, which is offering a tax holiday that started today and will run through Sunday. The holiday will apply to clothing under $100 and school supplies under $20, which amounts to a five percent discount on those items. Virginia will offer another sales tax holiday in October, this one for Energy Star and Water Sense products to help prepare consumers for the high-energy-use winter months.

The state of Georgia, however, dropped its tax holiday this year. State lawmakers said that they could not afford the loss of $12 million in taxes at a time when Georgia is running a $2 billion deficit. Washington D.C. shoppers will not get a sales tax holiday either, because local officials felt the holiday was costing the district too much money (about $1.3 million).

Most states offer a tax holiday to make it easier for families to buy school supplies. Some states, however, drop taxes to make it easier for families to prepare for hurricanes or other disasters, to make it easier to buy energy-efficient appliances, or even to buy firearms.

Researchers say that the tax holidays do little to stimulate the economy, since most consumers are buying items that they would have had to buy anyway, but are delaying the purchases to coincide with the tax holidays.

Sources used:

Associated Press. “Summary box: Illinois debuts sales tax holiday.” The Chicago Tribune. Aug. 6, 2010.

Associated Press. “Texas sales  holiday Aug. 20-22.” The Houston Chronicle. Aug. 5, 2010.

Beeler, Carolyn. “States’ tax holidays are irresponsible, critics say.” NPR. Aug. 6, 2010.

Deer, Karen. “Spend smart: save money with back-to-school sales tax holiday.” The St. Louis Post-Dispatch. Aug. 7, 2010.

Lade, Diane. “Sales tax holiday is back, Aug. 13-15.” The Orlando Sun Sentinel. Aug. 5, 2010.

Moore, Ryan. “Tax holiday: ‘tis the season when many states waive sales taxes.” The Christian Science Monitor. August 6, 2010.

Seltz, Johanna. “Governor came to town to sign sales tax holiday bill.” Boston.com. Aug. 6, 2010.

“Tax-free shopping in Va., Md. this weekend.” The Washington Post. The Breaking News Blog. August 6, 2010.