Give Hawaii a break with a tax holiday
IN MISSOURI, Georgia, Iowa, Louisiana, New Mexico, North Carolina, Oklahoma, South Carolina and Tennessee, the annual sales tax holiday ended this weekend.
In seven other states, their tax holiday is at a different time of the year.
Some states have more than one tax holiday.
Florida, for instance, has a tax holiday from Aug. 4 to 13 for folks to buy clothes and school supplies without having to pay the state tax. From June 1 to 12, the beginning of hurricane season, state taxes are forgiven on hurricane supplies and equipment.
New York was the first to offer a tax holiday back in 1997. By 2004 the number had grown to 12. Today 16 states offer a relief from paying state sales tax. You can check out each one at www.taxadmin.org.
BESIDES Florida, four other states and the District of Columbia offer two holidays a year. Connecticut has a holiday for school clothes in August and another holiday in June for "weatherization" products that make your house more energy efficient. Virginia has a special October tax holiday for buying just energy-efficient products. Tennessee limits its two tax holidays to clothing, school supplies and computers by monetary amounts -- with clothes worth up to $100, $100 in school stuff and $1,500 in computers.
Texas has just one tax holiday, when clothes and backpacks priced under $100 are tax free. With an 8 percent sales tax, that's good savings.
Across the country, the tax holidays are popular with both Republicans and Democrats. The Democrats can say they feel the pain of working families and are helping them get items they need and that will help foster education and the environment. Republicans, of course, can say they are helping to cut taxes.
IN HAWAII, the tax holiday was offered up this year by GOP Sen. Sam Slom. He wrote a proposal, which never even got a hearing, so that stores would not be allowed to keep any of the savings, nor would they be permitted to raise prices before the tax holiday.
"It has been proven that this works -- it stimulates the economy and stimulates buying," Slom said.
"Anyone in marketing will tell you that a sale works. It will help local consumers and local businesses.
"And, of course, it is an excuse for more shopping," Slom said.
Not all the evidence, however, is positive. Some studies have shown that states lose money on the nontaxed purchases, but supporters say shoppers don't limit their weekend tax holiday shopping to just tax-exempt items, so overall sales go up.
Of course, here in Hawaii the state says it will cost $15 million just to administer a tax increase for Honolulu, so if we had a tax holiday, Hawaii would probably send taxpayers a bill for the holiday at Christmas.