Business & Tech

Sales tax holiday debate is returning to Beacon Hill

Retailers of big-ticket items, like furniture and appliances, have benefited the most from state tax holidays in past years.

John Tlumacki/Globe Staff/File 2007

Retailers of big-ticket items, like furniture and appliances, have benefited the most from state tax holidays in past years.

Everyone loves to save money. And if you can do it by skirting taxes, all the better.

So pay attention here. It’s time again on Beacon Hill for the will-they-or-won’t-they summer drama known as The Sales Tax Holiday Debate. Legislative leaders typically play dumb, right until the end, and then announce the holiday for the second weekend in August.

Advertisement

Shoppers line up to take advantage of the 6.25 percent discount — often alongside numerous in-store promotions.

That’s the way it always happens. Or almost always. Since the state’s first sales tax holiday in 2004, Massachusetts lawmakers skipped it once during the recession (2009) and then last year during a time of budgetary pressures.

Get Talking Points in your inbox:
An afternoon recap of the day’s most important business news, delivered weekdays.
Thank you for signing up! Sign up for more newsletters here

Merchants worry about a replay of last year’s July cancellation of the tax holiday, which prompted many retailers to offer the same discount themselves that weekend in August.

So this year, the Retailers Association of Massachusetts sent out a plea to its members on Tuesday, urging them to lobby legislators for the holiday’s return — particularly with the increasing competition from e-commerce vendors. Several tax holiday bills will be up for a public hearing next week before the Legislature’s revenue committee.

A recent Federal Reserve study concluded that the tax holiday had a moderately positive impact on retailers’ revenue for the month. Sellers of big-ticket items — appliances and furniture — benefited the most. But many state leaders remain skeptical that the gains are worth the estimated $25 million in foregone sales tax revenue.

Advertisement

Unfortunately for the retailers, lawmakers are staring down a budget hole of more than $400 million.

Every dollar counts. But the same can be said for many Main Street stores.

Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.
Loading comments...
Real journalists. Real journalism. Subscribe to The Boston Globe today.
We hope you've enjoyed your free articles.
Continue reading by subscribing to Globe.com for just 99¢.
 Already a member? Log in Home
Subscriber Log In

We hope you've enjoyed your 5 free articles'

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week
Marketing image of BostonGlobe.com
Marketing image of BostonGlobe.com