"Mass. shoppers take advantage of tax-free shopping; Consumers, retailers are happy" by Kathy McCabe and Laura Gómez | Globe Staff and Globe Correspondent August 16, 2014
Massachusetts consumers went on a tax-free shopping spree Saturday, cashing in on late-summer sales and discounts on everything from laptop computers and refrigerators to paddleboards and kayaks.
I have been doing this blog a long time, and I'm tired of posting bu$ine$$-pimping promotions from the propaganda pre$$ so I didn't $hopping this weekend. $orry.
Falling one week later than prior years, the tax-free weekend coincided with the traditional start of back-to-school shopping. Parents and kids packed aisles at retailers throughout Greater Boston to buy backpacks, athletic cleats, sneakers, clothes, and other school supplies.
“I’m probably going to come back tomorrow,” Saida Joseph, 40, of Hyde Park said after buying clothes for her daughter at Forever 21 and a North Face backpack at South Shore Plaza in Braintree. “I’m going to tell my family and friends, too.”
“I just saved money,” an elated Chris Johnson, 37, of Randolph said after purchasing two pairs of Air Jordan sneakers at the mall.
Brian and Sandra Malone of Quincy paid $449 for a washing machine at Sears, saving about $30 in sales tax. “It’s good for the economy,” Brian said, “hopefully.”
The tax-free weekend lifts the state’s 6.25 percent sales tax on purchases totaling $2,500 or less. But it does not apply to cars, gasoline, motor boats, meals, tobacco, and certain other products, according to the state Department of Revenue.
Since enacted by the Legislature in 2004 to boost the economy, the sales-tax-free weekend has grown to rival the crucial holiday shopping season, with sales topping $500 million, according to the Retailers Association of Massachusetts.
“August has become the new December for retailers in Massachusetts,” said Jon B. Hurst, president of the nonprofit trade group.
Many retailers earn 2 percent of their annual sales during this weekend, Hurst said.
“That’s a lot of money,” he said. “For some, sales could be as high as 10 percent.”
Appliances, computers, furniture, and mattresses were among the big-ticket sellers, retailers said.
“One customer bought a whole kitchen — a refrigerator, a dishwasher, a stove, and a microwave,” said Peter Pappas, owner of Harrison Refrigeration and Stove Supply in Roslindale. “She saved about $375 in tax. That’s a real savings.”
Simon Malls, the region’s largest operator of shopping malls, has extended the malls’ operating hours for the weekend. Sales and discounts offered at Macy’s and other retailers helped to lure customers to malls even on a sunny August morning.
“Saturday morning usually isn’t a busy time at a mall, but people were here today,” said Richard Balest, who is general manager of Liberty Tree Mall in Danvers and was also filling in as general manager at Northshore Mall in Peabody. “We’ve had a lot of activity in stores like Apple and Sears.”
“People are shopping,” Mike Connell, general manager at the Burlington Mall, said in the afternoon. “And I would say it definitely has a back-to-school aspect. Our Apple store is probably busiest.”
The tax-free holiday is particularly welcomed by retailers in communities near the border of New Hampshire, which does not charge sales tax.
“This helps a lot,” said Tom Reinke, general manager of Riverside Cycle, which has shops in Haverhill and Newburyport. “I hate losing sales [to New Hampshire competitors] because of a . . . sales tax.”
Sales of road bikes were on a roll Saturday, with cyclists clamoring to take advantage of both the tax break and clearance sales before 2015 models arrive next month, Reinke said.
“It’s the end of the season, so everybody is looking for deals,” he said, noting demand for road bikes. “This [tax break] is the impetus for them to say, ‘Yep. Let’s do it this weekend.’ ”
Joel Thomas, owner of New England Small Craft Co. in Rowley, sold a $699 paddleboard and a $999 kayak Saturday. Still, one tax-free weekend in August isn’t enough to make up for business lost year-round, he said.
“I think the whole thing is a farce,” he said. “Nobody who lives north of the [Massachusetts] Pike buys anything taxable like a computer or a refrigerator here. They just go up to New Hampshire.”
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Also see: Tax holiday set for this weekend
"Gubernatorial candidates weigh lowering sales tax" by Shirley Leung | Globe Staff August 12, 2014
Another year, another sales tax holiday this weekend, which always makes me ask: When will the state give us a real break and roll back the sales tax to 5 percent?
Beacon Hill raised our tax on goods to 6.25 percent in 2009, as Massachusetts and the world buckled under the Great Recession. The new rate, which amounts to a 25 percent increase, brings in about $1 billion in additional revenue.
I thought the hike would be temporary — when the economy improved, we would go back to 5 percent. Wishful thinking, apparently, but other states have lowered taxes after bumping them up during bad times. Last year, Governor Deval Patrick tried to tinker with the formula, proposing to decrease the sales tax to 4.5 percent, while raising the income tax and doubling personal exemptions. What happened: crickets.
What would a new governor do? I posed the question to eight candidates vying for Patrick’s job. Four of them — Charlie Baker, Jeff McCormick, Mark Fisher, and Scott Lively — said they would consider lowering the tax.
“Sales tax, which can be regressive in nature, should again be a focus,” said McCormick, a Boston venture capitalist who is running as an independent. “People are struggling, and it’s a very real tax.”
McCormick, who also favors bringing down the state income tax to 5 percent, said he would fill the billion-dollar hole by making government more efficient, such as through savings on energy and health care costs.
Fisher, the GOP challenger to Baker, was also enthusiastic about chopping taxes, as any good Republican would be. The Shrewsbury businessman is not worried about a shortfall, explaining the measure would pay for itself.
“Cutting taxes would stimulate the economy by putting money back in people’s pockets,” Fisher said. Besides, the Tea Party candidate thinks the state has plenty of revenue to play with. “If Governor Patrick can find $11 million to renovate his office, we don’t need this increase.”
Baker, being the moderate that he is, said through a spokesman that he would consider rolling back the sales tax if Congress passes a law that would allow states to collect taxes on Internet purchases. Lawmakers in D.C. are expected to revisit that issue later this year. It could mean an additional $400 million in annual tax revenue for Massachusetts.
“Charlie would use that money to reduce the sales tax as close to 5 percent as possible,” said campaign spokesman Tim Buckley.
Rather than adjust the sales tax, independent candidate Evan Falchuk is pushing for a tax overhaul. Meanwhile, Democrats — those bleeding-heart tax-and-spenders — argue the state needs the extra money to maintain critical services and make investments in areas such as education and transportation.
“With the economy slowly improving, we need to seize this moment to invest in areas that will make Massachusetts stronger and create opportunities for every individual and family trying to build better lives,” Attorney General Martha Coakley said in yet another generic campaign statement.
State Treasurer Steve Grossman, according to his camp, wants to keep the current rate so the state can fund universal pre-K education and freeze fees and tuition at public colleges, among other priorities. He also wants to make the tax code more progressive for moderate- and low-income families.
Don Berwick, the health care reformer, offered the blandest position, saying through a spokesman that he would need to “look carefully” at a proposal and would want to ensure the “most disadvantaged among us receive support they need.” I was hoping for something more exciting from someone who has been called the Mick Jagger of medicine.
The reality is we’re doing better. The state collected over $23 billion in tax revenue last fiscal year — 5.6 percent more than during the prior year and $169 million above projections. The more we give, the more Beacon Hill will find a way to spend.
Instead of a tax holiday, give us something we can enjoy all year long.
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Related: Baker Taking Lowell Road to Governorship
