File this under: Better late than never.
Governor Glenn Youngkin and the General Assembly couldn't get their act together to pass a sales tax holiday in time for mid-August, when retailers love the boost in back-to-school sales. But now, this weekend, the sales tax holiday that usually happens in the summer will be the third weekend in October.
Megan Davis at the Commonwealth Institute suggests there might be better ways to help families than by temporarily cutting the sales tax on clothing and school supplies. "Sales tax holidays are more accessible to wealthier families as they are more flexible and better able to arrange their spending habits around state sales tax holidays, and they also have more disposable income to use on these holiday weekends," Davis contends. "So while it's a nice temporary reprieve from paying sales tax, there's more that we can do to help families through our tax code."
Davis says changes to the earned-income tax credit or a state version of the child tax credit that brought child poverty levels down to record lows during the pandemic would be better long-term solutions.
But she also notes the near-term tax holiday isn't just for school supplies and shoes. It also applies to emergency supplies. "Portable generators, gas-powered chainsaws, chainsaw accessories and items that families use to be ready for hurricane season, which we are currently in."
The sales holiday runs from Friday to Sunday, and the savings will range from 5.3 percent to 7 percent depending on your local sales tax rate.
This report, provided by Virginia Public Radio, was made possible with support from the Virginia Education Association.
