Sales Tax Holidays Threatened by Budget Crisis

7:53 PM, Mar 10, 2010   |    comments
Back-to-school sales tax holidays could disappear.
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ATLANTA - For the past nine years many Georgians have enjoyed a three-day sales tax holiday each August to buy back-to-school supplies and clothing.

Many also paid less for energy saving appliances and energy saving home improvement products during a similar sales tax free weekend in the fall.

But those tax breaks could disappear this year thanks to a budget crisis under the gold dome.

Faced with a $1-billion hole in the state budget, lawmakers are now eyeing the sales tax holidays as low hanging fruit fresh for the picking.

That's because it could mean a $14-million savings for them.

"We need that and I think it's more important to hold that back this year and put that into education or health care or whatever else we choose," says Representative Ben Harbin (R-Evans), Chairman of the House Appropriations Committee.

But a South Georgia lawmaker who helped create those sales tax holidays a decade ago says hold on a minute.

Senator Tim Golden (D-Valdosta) argues the lost $14-million in sales tax revenue might bring in even more money because shoppers buy non-exempt items at the same time, especially many from surrounding states.

"We're a border community," says Golden, "When we have the sales tax holiday go to the Valdosta Mall and what do you see in the parking lot? Florida tags. It's bringing a lot of revenue into the state."

State House Speaker David Ralston (R-Blue Ridge) told 11 Alive News he also favors dropping the sales tax holidays this year.

"I'm hearing from a lot of Georgians who really prefer to keep the classrooms open and keep the teachers teaching over the sales tax holiday," Ralston says.

But he said lawmakers will study the issue to see if they will also be losing money by dropping the tax break, as Sen. Golden argues.

"We're having to weigh the benefits against the cost of it and at the end of the day I feel confident we're gonna make the right decision," Ralston adds.

But way things are going at the State Capitol, many Georgians could end up paying more on getting kids ready for class next fall to help save their teachers.

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