The Center Square [By Jon Styf] –
Starting Friday, Tennessee will begin its annual sales tax holiday for school supplies, clothing and computers that will run through midnight Sunday.
On Monday, a month-long grocery sales tax holiday will begin. The break on the state’s 4% tax on food and food ingredients will cost the state $82 million with an estimated $49 million in grocery taxes that won’t be collected and the $31 million the state will send to local governments to cover their portion of taxes that won’t be collected.
“During this time of record inflation and high prices, we’re proud to be able to put money back in the pockets of Tennesseans,” said Tennessee Gov. Bill Lee said. “I encourage everyone to take advantage of these savings opportunities.”
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The clothing tax holiday this weekend applies to individual items that cost $100 or less with the same $100 stipulation applied to school and art supplies. Personal use computers, laptops and tablets that cost less than $1,500 also are tax free this weekend.
The grocery tax holiday was touted as a break for Tennessee residents in the budget by Republicans in the General Assembly and Lee, but not all agree that it is good policy.
“They are a gimmick and do not provide any long-term value to taxpayers,” said Tori Venable, Tennessee State Director of Americans for Prosperity. “With the billions that have been over-collected to balloon our state surplus lawmakers should be looking to cut taxes on Tennesseans permanently.
“They should start with repealing the Privilege Tax — in a state that has constitutionally banned the income tax it is appalling that anyone should have to pay for the ‘privilege’ of working in their chosen profession. After repealing any remaining unjust or unconstitutional taxes, they should look to permanently reduce the sales tax on food.”
Tennessee has collected $4.3 billion more than budgeted through the first 11 months of the fiscal year. The state has collected $173.9 million more than estimated in privilege taxes for the fiscal year.
This year, the state’s budget spent $9.7 million in funding to cut the professional privilege tax for physicians in both osteopathic and medical disciplines.
The Tax Foundation agrees with Venable, saying that the holidays “do not promote economic growth or significantly increase consumer purchases; the evidence (including a 2017 study by Federal Reserve researchers) shows that they simply shift the timing of purchases. Some retailers raise prices during the holiday, reducing consumer savings.”
About the Author: Jon Styf, The Center Square Staff Reporter – Jon Styf is an award-winning editor and reporter who has worked in Illinois, Texas, Wisconsin, Florida and Michigan in local newsrooms over the past 20 years, working for Shaw Media, Hearst and several other companies. Follow Jon on Twitter @JonStyf.
3 Responses
Another great article, Jon Styf, thanks! It is amazing to me how many politicians are bragging about being the most conservative these days….they all sound like parrots. As for those who have been in office, I suggest voters do some research on a few issues they’ve voted on. To me their voting record is ‘fair game’! In regards to this article, it states, “Tennessee has collected $4.3 billion more than budgeted through the first 11 months of the fiscal year. The state has collected $173.9 million more than estimated in privilege taxes for the fiscal year.” As they say, “Chump Change”, I guess. So, my question is, how can anyone in the legislature or the governors office ‘claim’ the conservative mantel with the kind of voting record it would take to overtax their constituents this much? I understand the argument that ‘big government’ needs to stock pile some ‘reserves’, but as a ‘conservative business man’ myself, I know what I’d do with those kinds of reserves! Apparently, elected officials, who like to claim the ‘conservative’ mantel are not really serious about over-taxation. And, oh by the way, thanks for the crumbs you’ve thrown us for this sales tax free weekend, unfortunately I don’t need clothing or a computer, but I guess I could go buy more groceries than I need and stock pile them…..kinda like the state is apparently doing with our taxpayer dollars!
Well said Mr. Andrews. I have been writing about this same issue. You hear about the huge surplus that Tennessee always has as if it is a badge of honor. It is great to have a reserve of money but what amount is too much. The amount that the state seems to have is an over abundance. All the politicians say ” Lets give the taxpayer a break because of this high inflation”. Then all they do is throw us crumbs. But yet they are willing to give professional sport teams hard earned taxpayer money in the millions if not billions of dollars. This is just sickening. The average Tennessean taxpayer is not going to get anything out of this deal. If the so called politicians really wanted to help taxpayers. How about doing away with property taxes for a year. Now that would be a real financial help in this time of inflation. Oh let’s not forget about all the financial help the state of Tennessee is going to give Ford a w*ke corporation. Then they will dictate to the state all kinds of demands. We need to keep Tennessee red and not have it turn bL*e.
In God we trust not government or man. Have a blessed day.
Tooting a tax break over groceries is EMBARRASSING, they think a few dollars will really make a difference? If they had not of SHUT US DOWN FOR 22 MONTHS we would ALL be in better shape. NOT IMPRESSED. Pathetic bunch, the lot of them.