Could Ohioans get a sales tax holiday?


Other states with sales tax holiday

Ohio would be the 19th state with a sales tax holiday. The others are: Alabama, Arkansas, Connecticut, Florida, Georgia, Iowa,, Maryland, Massachusetts, Mississippi, Missouri, New Mexico, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia.

Ohio shoppers could get a tax break next year if state lawmakers approve a sales tax holiday just in time for back-to-school sales.

The bill would exempt some items under a certain dollar amount from state and local sales taxes during the first Friday, Saturday and Sunday in August.

The following items would be exempt:

* School supplies such as pens, pencils and lunch boxes priced $20 or less;

* Clothing such as jeans, sweaters and jackets priced $100 or less;

* Electronics such as laptops, desktop computers and tablets priced $750 or less.

Ohio would be the 19th state with a sales tax holiday.

The bill is proposed by Sen. Kevin Bacon, R-Minerva Park, who introduced similar legislation in 2009. Two Ohio Democrats introduced similar legislation in September 2012. Neither bill had enough support to make it to a vote.

Bacon is the sole sponsor on Senate Bill 243. He said the proposal has the backing of retail merchants and consumer groups and is supported by a new study from the Economics Center at the University of Cincinnati. The study, commissioned by the Ohio Council of Retail Merchants, concluded that a sales tax holiday boosts business with minimal impact to sales tax revenue.

Gordon Gough, president and CEO of the council, said Tuesday that many shoppers purchase enough non-exempt goods during the holiday to offset revenues lost. Gough said Ohio families would save $78 million annually from the tax break.

But the conservative Tax Foundation concluded earlier this year that sales tax holidays shift the timing of purchases, but do not create real sales growth. The Cincinnati report also noted the brief increase in sales would be offset by a decrease in other months.

The average American family with children in school spent $688.82 on back to school items in 2012, according to National Retail Federation. The Economics Center study estimated the average household would save up to $38.

The center estimates overall retail sales volume in Ohio would increase 4.8 percent during the month of a three-day sales tax holiday.

“It’s been tested in other states and it’s a good opportunity to give a break to our families in Ohio at back-to-school time and provide economic stimulus for our retail merchants and local businesses,” Bacon said.

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