BATON ROUGE, La.– The first day of school is right around the corner for many Louisiana students.
As local 33’s Lucy Hayes reports, next weekend’s sales tax holiday may be able to save you some money on school supplies but also some other items you may not have thought about.
And while the savings may not be as much as last year, the Louisiana Department of Revenue reminds shoppers to keep receipts for back-to-school items. These purchases may qualify for tax deductions.
“Everybody jokes that it’s 70th in tax policy, and it’s true we have terrible tax policy, and the way that legislature monkeyed around with the sales tax holiday didn’t make it any better,” said State Director, National Federation of Independent Business Dawn Starns.
You may have an excuse to put off shopping until next weekend. On August 5th and 6th families shopping for electronics, furniture, and back to school supplies will get a better bang for their buck.
“It drives consumers out to shop locally, and for us that is the big factor. Small business are still recovering from the recession. They are still trying to find ways to engage customers on a daily basis, and something like a sales tax holiday while it may not be a lot of money on the savings side. It does drives consumers,” said Starns.
But if you’re looking to buy some personal property you’ll only pay three percent sales tax instead of the full 5 percent.
“It’s not a huge bump one way or another, so it is really just a good thing to be able to do. That our business owners in the retail sector tell us it does help them. They see a difference they see consumers coming out to their shops on those weekends, so for them it is important it is a big deal,” ,” said Starns.
Now this holiday doesn’t apply to everything including if you’re staying at a hotel.
“The tax foundation is concerned with our already egregiously set up complicated tax system,” said Starns.
The tax foundation, an independent policy research organization issued a special report saying quote:
“Sales tax holidays neither promote economic growth nor increase purchases. They create complexities for all involved, while inserting the political process into consumer decisions.”
And while she doesn’t agree that the state should scrap sales tax holidays, she thinks lawmakers can improve long-term tax policy.
“We want to see that sales tax rolled back. We don’t want to see we want to see the tax on business utilities we’d like to see that rolled back. That is a hit to small business owners. There needs to be overall reform to the inventory tax credit,” said Starns.
“We have to make sure that we have a tax policy that supports small business owners that supports you know a homegrown based economy not just how to attract the bigger businesses from out of state,” said Starns.