August 21, 2009
Associated Press Interviews Staff Economist Mark Robyn on Sales Tax Holidays
"Stores like tax holidays; tax experts pan them"
By Dave Gram
A big shopping day is expected Saturday in Vermont, where its 6 percent sales tax—7 percent in Burlington and other cities and towns that add a 1 cent local option tax—will be on hold for purchases of "tangible goods" costing less than $2,000. The break will cover everything from furniture to computers to liquor. The state already exempts clothing, footwear and food bought in stores from the tax.
Some retailers say there's a downside to the holiday: slower sales leading up to the day and sometimes afterward, as well.
"It's just a timing shift; it's not an overall increase in the purchases that are made," said Mark Robyn, a staff economist at the conservative-leaning Tax Foundation and an author of a new study on the holidays. ...
"They're bad tax policy, essentially just a political gimmick," Robyn said, adding politicians like them because "it makes it look like they're cutting taxes and helping people."
