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School tax holiday stretches shopping dollars
By Peggy Blackburn
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For the third straight year, back to school shoppers in most areas of Elmore County will get a significant cost break on selected school supplies this weekend during Alabama’s statewide sales tax holiday. In addition to the state’s abatement of its 4-cent sales tax, Wetumpka, Eclectic, Millbrook and the Elmore County Commission have all opted to join other communities across the state in suspending collection of sales taxes from 12:01 a.m. Friday until midnight Sunday.
Local shoppers will still be required to pay the 1-cent sales tax that accrues to the Elmore County Board of Education. In Tallassee the holiday is limited, with four-fifths of one cent that will not be waived. Coosada, Deatsville and Elmore are not participating in the tax-free holiday.
Purchases that will be exempt from state sales tax during the holiday are: most clothing costing up to $100 per item; computers, software and computer supplies up to $750 per item; school supplies and textbooks up to $50 per item; and other books up to $30 each.
Through July 25, 241 cities and counties across the state had passed legislation to participate in this year’s sales tax holiday according to the Alabama Department of Revenue.
Nancy Dennis of the Alabama Retail Association said that, according to the National Retail Federation, 22.7 percent of parents in the South have set aside a portion of their federal economic stimulus check for school purchases and 77.2 percent plan to buy the bulk of those items at discount stores.
“Families with school-aged children in the South plan to spend an average of $611.02 on back to school purchases,” she said.
According to NRF’s research, the average parent of school-aged children in the South plans to spend:
$252.33 on clothing
$119.65 on shoes
$108.06 on school supplies
$248.56 on computer-related equipment and electronics
“Alabama’s sales tax holiday means savings for more than just back to school shoppers,” said Dennis. “Those interested in filling out their wardrobes and stocking their libraries and home offices also can benefit from buying during the tax-free weekend. While the holiday is aimed at the back to school shopper, it is open to everyone.”
Dennis cautioned that not everything is tax free during the weekend. She said a detailed listing of what is and isn’t taxed can be found on the Alabama Department of Revenue’s Web site and the Alabama Retail Association’s Web site.
“Savvy consumers should spend some time learning what items are tax free before heading to the stores,” Dennis said.
She added that the sales tax holiday has proven to be extremely popular in the state, with sales tax collections in August increasing 10.4 percent in 2006 and another 4.6 percent in 2007 compared with the first year.
A total of 15 states and the District of Columbia offer sales tax holidays on back-to-school purchases. Florida will not have a sales tax holiday this year.
