Editorial: Tax-free holiday benefits shoppers and retailers
Published: Friday, August 30, 2013
Updated: Friday, August 30, 2013 00:08
As Connecticut’s growing hunger for revenue continues through unstable economic conditions, the state sacrificed a week’s worth of sales tax revenue this past week to help benefit its businesses and citizens. From Aug. 18-25, Connecticut had a tax-free holiday for shoppers on clothing and shoes, with sales tax being removed from any item valued up to $300. Originally enacted back in 2011, this tax-free week is designed to coincide with back-to-school shopping season. According to the State of Connecticut Department of Revenue Services, there were no limits to how many items a shopper could buy, and thus, to any shopper the savings seemed endless.
As with most tax breaks, this week came at a price. According to WABC, Connecticut was estimated to have lost over $8 million in tax revenue. Nonetheless, this tax-free holiday helped get more shoppers into retail stores and also helped consumers save a bundle. Even though the benefit only extended to items like shoes and shirts, it is still a welcome savings for families especially given the rising costs of other goods and services.
Tax-free week is also beneficial to Connecticut’s economy, as it brings more people into retailers and allows these retailers to generate extra revenue. Some shoppers used to travel to New Hampshire before the school year to take advantage of the state’s lack of a sales tax. However, with this tax-free holiday, shoppers don’t need to go out of state and can continue to support Connecticut businesses. A sort of Black Friday mentality also helps businesses where the saving can encourage consumers to buy more than they might normally buy on any other week where the sales tax was in effect.
All in all, Connecticut should continue hosting this tax holiday. Though it does hurt government revenue, it makes up for it by given a boost to the economy through businesses and retailers within Connecticut as well as doing a service to parents and the stereotypical poor college student who are looking to save whenever they can.