It’s not Black Friday, Cyber Monday or any of the other hot shopping days leading up to Christmas, but this weekend’s sales-tax free “holiday” gives retailers a foot-traffic boost.
“Mini-Black Friday is what we call it around here,” said James Steinbach, general manager of Best Buy near Perimeter Mall.
Bargains, however, will be limited in scope compared to other parts of the year.
Taxes won’t be collected on computers or computer components under $1,000 per item, on school supplies less than $20 or clothing — including shoes — costing below $100. Most other items — DVDs, jewelry, cookware, etc., will incur normal sales taxes.
The “holiday” comes as brick-and-mortar retailers feel the ever-increasing bite of online shopping. Many have struggled with same-store sales, though the National Retail Federation has raised its forecast for the year on stronger consumer spending statistics.
In addition, July is generally a soft month as many consumers vacation.
Georgia consumers are expected to save $74.5 million during the “holiday,” according to Gov. Nathan Deal’s office.
“The back-to-school tax-free holiday allows Georgia’s families and students to save money on crucial school items, clothing and technology during a time of year when household expenses add up quickly,” Deal said in a release Thursday.
But the 17 states that will host a sales-tax “holiday” this year will lose a total of about $300 million in tax revenue, according to the Institute on Taxation and Economic Policy.
The Georgia Public Policy Foundation, which opposes the annual event, said, “Despite their political popularity, (sales-tax holidays) are based on poor tax policy and distract policymakers and taxpayers from real, permanent and economically beneficial tax reform.”
Tom Smith, a labor economist at Emory University, said retailers don’t gain much either, because consumers would have made the purchases anyway, just at a different time.
Some consumers will benefit, though, he said.
“For a parent on the margins, saving on the sales tax could be the difference between picking up a box of eight crayons or 24.”
Molly Blakeman, a spokeswoman for Walmart, said she sees parallels to Black Friday, including the preparation the chain undertakes to be ready for the crowds.
“Sales tax holidays are really big weekends at our stores,” she said.
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