August 6, 2006
Boston Globe -- Shoppers, Rejoice!
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There's little question that, when the holidays occur, sales jump. But the measure of an economy is not retail sales for a day or two. The real issue is, do the holidays somehow spur sales for the year to higher-than-normal levels? Curtis Dubay, an economist with the nonpartisan Tax Foundation in Washington, D.C., argues no. "These are sales that would have occurred otherwise," he says. Most people are on a budget, with a relatively fixed amount of discretionary income. The opportunity to save 5 percent, for example, will persuade few to buy an item they otherwise would not have purchased. At most, a tax holiday will merely change their timing.
