Peoria Journal-Star
Aug. 4, 2010
By Steve Tarter
Back-to-school shoppers will look for extra credit when they hit the stores this weekend.
That’s because in addition to the traditional sales offered at this time of year, customers won’t have to pay the state sales tax on certain supplies.
The sales tax holiday, an idea first started in Texas in 1999 and now spread to a host of states across the country, will be a first for Illinois, starting Friday and running through Aug. 15.
“This finally gives Illinois an advantage over its neighbors. States like Wisconsin, Indiana and Kentucky don’t offer any kind of sales-tax holiday, while Iowa and Missouri both do it, but only for the weekend,” said Rob Karr, senior vice president for the Springfield-based Illinois Retail Merchants Association.
But suspending the 5 percent state portion of the sales tax during this period won’t just help merchants located near the state’s borders, he said.
“The Illinois consumer – in Peoria and around the state – will clearly see the benefit. They say the average cost to prepare a child for school is $600. The suspension of the sales tax means you could save $30 per child. For families with several children, that adds up,” said Karr.
The tax holiday covers clothes, shoes, coats and school supplies, but computers, cell phones and most electronic equipment don’t qualify.
“It isn’t just retailers that will benefit but restaurants, gas stations and even hotels when people mount shopping expeditions,” Karr said.
Local governments still get their share of sales tax revenue and benefit further when more money is poured into the local economy, he said.
Karr noted the sales tax holiday has proved effective in other states. “Eighteen other states have seen tax holidays improve their economies. Florida skipped a holiday in 2009 after having them before and realized that the state lost over $100 million in revenue as a result.”
Area stores await the tax holiday with the same relish reserved for the December holidays.
“We’re bracing for activity. We’ve got special sales set up for the next two weekends,” said Bob Schertz, marketing manager for Northwoods Mall.
At Office Max, 4100 W. Willow Knolls Road, manager Joe Janusz also looks for shoppers to take advantage of the tax holiday.
“We’re going to see customers pretty excited when they see they can save 5 percent.
“It’s all about education for the event,” said Janusz, who noted that his store would clearly post what items qualify under the tax holiday.
At Target in Glen Hollow Shopping Center, department manager Chris Sayasane said some back-to-school shoppers didn’t wait for the tax break.
“Starting Sunday, we’ve seen heavy traffic in the store,” he said.
“Uniforms have really been selling well.”
Like Target, the J.C. Penney store at Northwoods Mall has beefed up staffing along with inventory.
“I went through this in Missouri. Tax holidays are just huge,” said Penney’s manager Rich Hudson.
The state’s decision to run the tax holiday for 10 days should prove beneficial, he said.
“It’s much better for the customer to have 10 days to shop,” said Hudson, adding that Penney’s is extending hours to 11 p.m. on Friday and Saturday during the holiday.
Sales tax holiday
The first sales tax holiday in Illinois will run from Aug. 6 through Aug. 15. During the holiday, the 5 percent portion of sales tax collected by the state will be waived. Local government sales taxes will continue to be collected. According to the Illinois Retail Merchants Association, the holiday applies to eligible school supplies, clothing and footwear with a retail price of less than $100. Computers, computer supplies, PDAs and cameras are not eligible.
