So, there’s this nice little thing called a sales tax-free week happening at Connecticut Post Mall in Milford on August 19, 2024. Some states like to do these sales tax holidays, giving shoppers a temporary break from taxes to get folks spending more. This stuff’s going on even as Trump’s tariffs might bump up prices.
During these holidays, state sales taxes—and sometimes local ones—are waived on certain items for a bit. What’s on the list varies: often, it’s stuff for back-to-school or prepping for disasters.
“Everyone loves a good tax break,” says Katherine Loughead from the Tax Foundation, who’s studied this a lot. But she also warns, it might not always be the awesome deal people think.
Now, while some say these tax breaks boost economic growth, reports show people might just be changing when they buy the essentials, according to Loughead. “Wealthier folks who have more flexibility really take advantage,” adds Miles Trinidad from the Institute on Taxation and Economic Policy in a blog post. Yet, middle- and low-income families also count on these tax holidays for bigger buys like school gear, experts note.
Take Shelly Werger out in Guttenberg, Iowa; a mom of seven who marks her calendar for these tax holidays. “Things are just too pricey, so I grab any chance to save,” she explains. Although, Iowa’s tax break is limited to clothing and shoes under $100, skipping school supplies and such. A bit of savings, but not loads, as Shelly put it.
This year, across 19 states, it’s pretty much the same number of sales tax breaks as last year. Some states have gotten more generous, others trimmed back, says Loughead.
When it comes to back-to-school shopping, these savings are super handy for families feeling the pinch. A survey by ParentsTogether found 75% of parents stressed over back-to-school shopping, with nearly half cutting back on food to fit school supplies into the budget.
And this year, a report from Intuit Credit Karma shows 39% of parents are having a hard time affording school stuff, up from 34% last year. Many started their shopping earlier to dodge those tariff-induced price hikes and hop on tax holidays and summer sales.
Katherine Cullen from the National Retail Federation mentions families are diving into school shopping earlier, on the lookout for discounts and tax-free holidays. Skipping the state tax might save you up to 7%, and combining that with other tricks—like store promos and cash-back deals—can really slash costs.
Ted Rossman from Bankrate suggests mixing the tax break with a store sale, then maybe using a rewards card, and even snagging more cash back online. Suddenly, that $100 spend could drop to about half. Cool, huh?
