Savings-minded shoppers, plan accordingly. The House and Senate on Thursday agreed that the weekend of Aug. 8-9 will serve as this year’s sales tax holiday.
Buyers can avoid the sales tax on many purchases, although critics say it doesn’t generate much new economic activity and merely shifts consumer buying patterns. Over the years, public officials have settled on holding the holiday in August in a bid to ramp up shopping during a lighter period for some retailers and to give families savings on back-to-school expenses.
During the annual tax holiday weekend, the state will suspend collection of the 6.25 percent sales tax on most items that retail for less than $2,500. The holiday does not apply to purchases of motor vehicles, motorboats, meals, alcoholic beverages, tobacco products, marijuana products, telecommunications services like prepaid calls, natural gas, steam or electricity.
The Department of Revenue estimated that indirect tax revenues generated due to increased economic activity during the sales tax holiday weekend last year totaled approximately $3.65 million.
The agency said the holiday resulted in about $36.59 million in forgone sales tax revenue for the state — $24 million of which would have gone into the General Fund; $6.5 million into the MBTA State and Local Contribution Fund; $5.8 million into the School Modernization and Reconstruction Trust Fund; and $82,600 to the Convention Center Fund.
After the branches adopted tax holiday resolutions, House Speaker Ron Mariano said in a statement that the holiday “will bring consumers needed economic relief while boosting revenue for small businesses and retailers” and Senate President Karen Spilka said lowering costs and supporting local businesses “is critical for our communities in this time of economic uncertainty.”
