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Sales tax holidays, fall editions, underway

Yes, it's state sales-tax holiday time again.

Sales_tax_holiday_2008_iowa Sorry, Georgia! Your event this weekend snuck up on me, what with the chaos in Washington, D.C., surrounding the financial services bailout bill.

But Peach State shoppers, you still have the rest of today to get out and spend save on purchases of energy- and water-saving products priced at $1,500 or less.

Conservation also is the focus of upcoming fall sales tax holidays in Virginia and North Carolina. (West Virginia's similar energy-efficient sales tax exemption days were the first week of September.)

No-sales-tax shopping in the nation's capital is timed to appeal to post-Thanksgiving holiday buyers.

And, of course, there is the sales tax break event for purchasers of certain firearms in South Carolina.

The table below offers a bit more information. Click the state name (or additional link) for more information from the state's official revenue office. 

Fall Sales Tax Holidays
Click on the state name to go to the official tax holiday Web page.
State Dates Tax-exempt Items
Georgia  October
Energy- and water-efficient products priced at $1,500 or less that have been designated as meeting requirements of the U.S. Environmental Protection Agency and U.S. Department of Energy "Energy Star" programs
Virginia October 10-13 Energy Star and WaterSense qualified products priced at $2,500 or less
North Carolina
November 7-9 Energy-efficient clothes washers, freezers, refrigerators, central air conditioners, room air conditioners, air-source heat pumps, geothermal heat pumps, ceiling fans, dehumidifiers, and programmable thermostat
South Carolina November 28-29 Handguns, rifles and shotguns
District of Columbia Nov. 21 - Dec. 7 Second round of savings on School supplies, clothing, accessory items and shoes ($100 or less)

Tax policy debate: As I've mentioned before, most recently in the "Popular, but poor, tax policy" section of this post back in April, many (including me) believe that tax holidays are a gimmick that really do consumers, businesses and governments little good.

The better approach would be to enact year-round tax policies that provide customer savings and business incentives.

But Martin Ruano, a law student at George Washington University, disagrees with sales tax holiday critics.

Ruano, who has worked at the California State Senate and begins work this fall at Orrick, Herrington & Sutcliffe LLP, writes in an article published in the Sept. 30 issue of Tax Analysts:

Ultimately, sales tax holidays are solid public policy resulting in various effects that are attractive to the entire political spectrum. Holidays help alleviate the regressive nature of the sales tax, and minimizing regressivity is a goal that political and economic liberals support. Tax holidays spur economic activity and are a boon to in-state businesses, which is attractive to both sides of the political aisle. For libertarians and pure conservatives, tax holidays present a political opportunity to cut back on government and keep taxpayer dollars out of the hands of government spending lobbies. Although tax holidays are not a perfect solution to the ills of the sales tax, the tax holiday causes relatively little harm to state governments and produces great benefits to businesses.

This year, more than a dozen states agree with Ruano, enough so that some scheduled multiple sales tax holidays.

We'll just have to wait and see how many still feel that way if the economy continues to sputter.


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