Tax-free shopping this weekend

Published 12:00 am Thursday, August 4, 2011

By Emily Ford
SALISBURY — Ready, set, shop.
Local retailers are gearing up for the annual tax-free weekend, when shoppers can buy clothing, shoes and school supplies without paying sales tax.
The sales tax holiday runs from 12:01 a.m. Friday to 11:59 p.m. Sunday.
“I do think it’s essential for parents with school-aged children, whether in elementary or college,” said Donna Rowland, who plans to take advantage of the tax break.
In Rowan County, where the sales tax rate is 7 percent, buying a $1,000 laptop computer this weekend will save $70. The holiday will trim $7 from a $100 pair of sneakers and $2.10 from a $30 backpack.
Walmart manager Gary Sixkiller is cautiously optimistic. While the three-day event has been a big weekend in the past for Walmart, sales in general have been disappointing this year, he said.
“With the economy down, it’s hard to say what it will be like,” Sixkiller said. “But we will be prepared for it if they do come.”
Compared to a regular weekend, sales at the Thread Shed usually double on the tax-free weekend, owner Dave Loflin said.
“It’s usually very good and very busy for school uniforms,” he said.
Like many downtown businesses, Thread Shed will extend hours Friday and Saturday and open Sunday afternoon. Downtown Salisbury Inc. will host Summer Night Out from 5 to 9 p.m. Friday in conjunction with the sales tax holiday, and many stores will offer deep discounts in addition to the tax break.
No sales tax will apply to every item at two stores — Just the Thing (103 N. Main St.) and Creative Teaching Aids (310 S. Main St.) — where all products are considered educational.
Teachers will shop for their classrooms, and parents and grandparents will stock up for birthdays and Christmas, said Glenda Dyson, owner of Just the Thing. Teachers are spending their own money, so every savings helps, she said.
“Teachers have been waiting to shop,” Dyson said. “We have items on hold for them that they will buy this weekend to save the taxes.”
In a survey by Parents magazine and Lands’ End, 81 percent of parents reported they will shop during upcoming tax-free holidays — a 9 percent increase from last year’s survey findings.
While the holiday is popular with retailers and back-to-school shoppers, some criticize the policy, which costs the state an estimated $12 million in revenue.
“All levels of government are hurting for tax revenue,” said Harry Agner, manager of the Salisbury-Rowan Farmers Market. “Why are they doing this when they need to hire teachers and provide services?”
Critics argue sales tax holidays, now held in 17 states, don’t stimulate the economy because shoppers would buy computers, clothes and school supplies anyway.
“Studies show consumers are timing their purchases to coincide with sales tax holidays,” said Edwin McLenaghan of the N.C. Justice Center, which opposes tax-free weekends. “It’s not an increase in spending.”
Other policies, such as increasing the earned income tax credit, would better target tax relief for low- and moderate-income families, offering more “bang for buck” than a temporary sales tax holiday, McLenaghan said.
At least one N.C. lawmaker is questioning the practice, which started in 2002.
Sen. Richard Stevens, a Republican from Wake County, recently called for a suspension of the program until lawmakers can evaluate it and determine if the state gains or loses revenue.
Contact reporter Emily Ford at 704-797-4264.