The Tax Foundation (an organization that does a lot of good work) informs us that “17 states, primarily in the southeastern U.S., will hold a sales tax holiday in 2016, down from a peak of 19 states in 2010.” Yet,
Despite their political popularity, sales tax holidays are based on poor tax policy and distract policymakers and taxpayers from real, permanent, and economically beneficial tax reform. Sales tax holidays introduce unjustifiable government distortions into the economy without providing any significant boost to the economy. They represent a real cost for businesses without providing substantial benefits. They are also an inefficient means of helping low-income consumers and an ineffective means of providing savings to consumers.
Three cheers for poor tax policy. If only more states enacted sales tax holidays more often on more goods.
2:55 pm on July 25, 2016 Email Laurence M. Vance
