Sales tax holiday ahead, but not for all

TUPELO – Back-to-school shoppers who missed out on the first state sales-tax holiday last year will get another shot this year.
For 48 hours, between 12:01 a.m. July 30 to midnight on July 31, retailers won’t collect the 7 percent state sales tax on eligible items.
“I’m looking forward to it,” said Jason Walton, who bought new shoes for his children last year. “Seven bucks here and there adds up.”
The sales tax holiday last year was a smashing success, said Jeff Snyder, general manager at The Mall at Barnes Crossing.
“For us and retailers it was a lot like another Black Friday,” Snyder said, referring to the day after Thanksgiving that traditionally ranks as among the busiest shopping days of the year.
“It was very well received, especially during these economic times. It also helped us lure and compete with other cities and states that had sales tax holidays.”
Not every city will participate. Fourteen municipalities have opted out of the program, including Guntown and Sherman.
“We decided not to participate because we don’t have a clothing or shoe store, or anything like that,” said Guntown Mayor Robert Herring. “If we had big stores that sold the items that are exempt, we would.”
The state returns a portion of sales tax revenue to cities, so taxes not collected would affect them.
That’s one reason the Legislature allowed municipalities to opt out when it passed the sales tax holiday legislation last year.
The items on the tax-exempt list are the same as last year’s – essentially shoes and clothing that cost less than $100 per item.
Computers and school supplies are not included.
Kathy Waterbury, a spokeswoman for the state Tax Commission, said the municipalities were not required to explain why they were opting out of the holiday.
“They did not share that information with us,” she said. “They only had to notify us if they were not participating.”
The impact of last year’s sales tax holiday is hard to gauge, however.
“Part of the difficulty is that last year, the sales tax holiday was spread over two months – July 31 and Aug. 1,” Waterbury said. “And we didn’t have anything to compare those numbers to.”
In addition, the economic recession has affected revenue and tax collections, so a true picture of the sales tax holiday may never be known.

Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.

Dennis Seid/NEMS Daily Journal