As school bells near, tax break is here
07/28/2013 8:56 PM
10/22/2013 11:29 PM
After robust back-to-school spending last year, shoppers are expected to cut back this year.
And they will be able to stretch their dollars a little further this weekend during South Carolina’s tax-free shopping period. The tax holiday – for items such as electronics, clothing and pens and paper – starts first thing Friday morning and runs through Sunday.
Shoppers statewide can save state and local taxes. In Richland County that means an 8 percent savings on back-to-school purchases, and in Lexington County, 7 percent. Many stores also offer additional sales to coincide with the tax holiday, which is the third-busiest shopping time of the year in South Carolina.
Families with school-age children are expected to spend an average of $634.78 on apparel, shoes, electronics and school supplies, down 8 percent from last year’s $688.62, according to a survey from the National Retail Federation.
That means the average family in Richland County could save about $51 and the average Lexington County family could save $44 by shopping during the state’s 14th annual tax-free weekend. Statewide, consumers are expected to save an estimated $3 million this year, according to the S.C. Department of Revenue.
Nationwide, total spending on back-to-school shopping is expected to reach $26.7 billion.
“The good news is that consumers are spending, but they are doing so with cost and practicality in mind,” Matthew Shay, federation president and CEO, said in a press release. “Having splurged on their growing children’s needs last year, parents will ask their kids to reuse what they can for the upcoming school season. As they continue to grapple with the impact of increased payroll taxes, Americans will look to cut corners where they can, but will buy what their kids need.”
That could mean shopping sales in addition to the tax holiday savings.
Back-to-school sales promotions began earlier this year than any in recent memory, retail experts have said, a reflection of an expected tough year for sales.
Wal-Mart, Target, Sears and other major retailers have bumped up their websites in preparation for this year’s sales, even as the economy continues to struggle along in its recovery.
And local businesses compete, as well.
The Devine Street Association, a coalition of retailers in that area, will hold its Art Stroll Sidewalk Sale in conjunction with the tax-free weekend, running from 9 a.m. to 6 p.m. Saturday and Sunday, spokeswoman Jennifer Suber said. Consumers can save up to 90 percent on certain items in addition to tax savings.
“It’s our annual sale. The merchants all participate and it’s a great thing for them to kinda get their summer merchandise moving and introduce people to fall lines,” Suber said. “It’s always very well attended. . . . People come there looking for bargains, and let me tell you something, you can get it. Great, great deals on things.”
One of the stores participating is Belladea at 2824 Devine St. The store will roll out a new collection by New York fashion designer and University of South Carolina graduate Jennifer Ghelardini during the weekend. Ghelardini also will be on hand to do custom dress orders, sales associate Nicole Smith said.
“She’s really amazing. She did Carolina Cup dresses and we just thought it would be really cool for her to do custom Game Day dresses through our store, because we have the space to get girls fitted. So it’s really exciting. That’s one of the biggest events that we are having in our store for the sale,” Smith said.
Belladea also has received a big shipment of Wendy Katlen and other designer merchandise for the sale during tax-free weekend.
Seventeen states will endorse tax-free sales on selected merchandise at some time this year, according to the nonpartisan Tax Foundation in Washington.
The sales tax holiday is not without its critics, however.
“Temporary rollbacks of sales taxes, despite being sold as a boon for consumers and businesses, actually impose significant costs on both groups without yielding significant benefits,” according to a new report by the Tax Foundation, which called sales tax holidays costly and poor substitutes for state tax reform.
“Political gimmicks like sales tax holidays distract policymakers and taxpayers from genuine, permanent tax relief,” said Joseph Henchman, Tax Foundation vice president for legal and state projects. “If a state has to offer a ‘holiday’ from its tax system, it’s a sign that there’s a problem with the system itself.”
Consumers put off purchases until sales tax holidays roll around, the Tax Foundation contends, rather than go out and make additional purchases simply because of the tax exemption.
“If politicians want to save money for consumers, then they should cut the sales tax rate year-round,” Henchman said.
It’s not too early to start thinking about sending the kids back to school. South Carolina will help with the cost of stocking up on supplies with its 14th annual sales tax holiday for back-to-school shopping this weekend. Here is what you need to know:• Shoppers can save state and local sales taxes, meaning 8 percent in Richland County and 7 percent in Lexington County, on a wide array of items.
• The sale starts Friday morning and goes through Sunday night.
• Examples of exempt items include clothing and clothing accessories, such as handbags, hats and hosiery; footwear; school supplies, including pens, paper, lunchboxes, books and calculators; computers, printers and computer software; bedding, towels and bath accessories.
• Examples of non-exempt items from the tax holiday include jewelry, cosmetics, eyeglasses and furniture, as well as items on layaway.
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