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Tax Free Back-To-School Shopping

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TALLAHASSEE (CBSMiami/NSF) — Those shopping for back to school supplies this weekend are getting a break thanks to a “sales tax holiday.”

The holiday, which will run today (Friday) through Sunday allows, shoppers to avoid paying sales taxes on clothes and shoes costing up to $60 per item; school supplies that cost $15 or less; and personal computers and related accessories priced at $750 or less.

At a Walmart in Doral, store manager Willy Santizo said it’s going to be a busier than usual weekend and shoppers should be prepared even before they walk through the front doors.

“They should have their school list ready. We have everything that they need, we have it, we’re going to be stocking our shelves during this whole entire process, this whole entire weekend,” said Santizo.

Betty Viera showed up at the store on a mission with a lot to get and about a $150 to spend.

“The notebooks and a lot of materials the school requires for my daughter and son,” she said.

The holiday was a large part of a tax-cut package (HB 7109) that lawmakers passed this spring. The package is projected to provide $91.6 million in tax breaks during the budget year that started July 1.

James Miller, a spokesman for the Florida Retail Federation, said the tax holiday is “much needed at this time of year,” as families buy clothes, supplies and other items before school starts.

“Families are going out and stocking up anyway,” Miller said. “Being able to save 6, 7, 8 percent is really big.”

A House bill analysis estimated the holiday period will reduce state revenue by $26.6 million and local government revenue by $6.8 million.

The state has offered back-to-school tax holidays most years since 1998. Computers return to this year’s list after being left out of a 2016 tax holiday.

Two years ago, meanwhile, the holiday ran 10 days, with the clothing limit at $100 and a discount on the first $750 of the sales prices of computers.

Florida retailers have long backed the tax holidays. But not everyone thinks such discount periods provide wide-ranging benefits.

The Washington, D.C.-based Tax Foundation released a study July 25 deriding the periods as simply shifting spending rather than stimulating economic growth.

“Shoppers waited until the holiday to purchase exempted goods, thereby slowing sales in the weeks prior to and following the holiday,” the study said.

The Tax Foundation questioned the expense of having to recalibrate store computers for the discount periods and called the holidays “a gimmick that distract policymakers and taxpayers from real, permanent, and economically beneficial tax reform.”

The foundation also labeled the discount periods as a form of “picking winners and losers” — a favorite target of many Florida politicians opposed to business incentives — by favoring products and industries through arbitrary tax exemptions. The foundation also maintained that large businesses lobby for the holidays as a way to receive free advertising.

Miller disagreed.

“I know there are reports out there saying these sales-tax holidays aren’t that good for retailers,” Miller said. “One thing I would say is if that was the case, retailers wouldn’t be making this one of their significant legislative priorities year in and year out.”

Florida, one of 16 states this year offering back-to-school breaks, also offered a tax holiday on disaster-preparation items in June to mark the start of hurricane season.

(The News Service of Florida’s Jim Saunders contributed to this report.)

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