Sales tax holiday!
Published 1:20 pm Wednesday, August 3, 2011
Back-to-school shoppers in North Carolina will have an added bonus this coming weekend (Aug. 5-7) when they hit the stores for merchandise ranging from book bags to boots, computers to coats, and PDA’s to printer paper.
The three-day exemption from state and local sales taxes was created by the North Carolina General Assembly specifically to help consumers with back-to-school shopping, since many schools and colleges begin classes in late August. This sales tax holiday weekend is typically one of the top sales periods for retailers throughout North Carolina and the other 17 states that offer this special benefit to their shoppers.
“During these challenging economic times, retailers understand that consumers are extremely focused on value and are taking this weekend to offer substantial savings on merchandise that parents will need for back to school,” said Fran Preston, president of the North Carolina Retail Merchants Association NCRMA). “Some retailers will also extend store operating hours so their customers have more time to take advantage of promotional offers and special prices.
This year’s back-to-school sales (combined K-12 and college) are predicted to reach $68.8 billion nationally, serving as the second biggest consumer spending event for retailers behind the winter holidays.
During this holiday, certain items are free from sales tax. In North Carolina these items include clothing, shoes and school supplies under $100 per item; certain school instructional materials under $300 per item; computer systems and educational software for personal use that are under $3,500; computer accessories that are $250 or less per item; and sports and recreational equipment under $50 per item.
For 2011, some new products added to the electronics market (tablets and eReaders) are exempt from tax, others are not: tablet computers such as the Apple IPad® and Motorola Xoom® have been added to the list of exempt items, while eReaders such as the Nook® and Kindle® remain in the “taxed” category.
“Electronics and computer-related items are among the best sellers during the sales tax holiday,” Preston reported. “Retail merchants also sell a lot of clothing, shoes and school supplies during this three-day period.
“Back-to-school shopping, which can account for 15 percent of consumer spending in the second-half of the year, can be a good indicator for retailers,” added Preston. “It is the driving force behind third-quarter retail sales. Our member companies typically report a sales increase of at least 10 percent during the third quarter.”
Using the past seven years’ success as a guide, Preston believes that North Carolina can expect to see heavy traffic, elevated sales, and great deals for consumers during the August 5—7 weekend.
NCRMA devoted an issue of its semi-monthly newsletter this spring to the terms of this year’s sales tax holiday and has more information on the sales tax holiday on its website at www.ncrma.org.