TALLAHASSEE – The Florida Retail Federation sent out a press release Jan. 17 applauding Gov. Rick Scott for including a 10-day Back-to-School Sales Tax Holiday in his budget proposal to the Florida Legislature.
Families across Florida benefit from big tax savings on clothes and school supplies during the Back-to-School Sales Tax Holiday, a popular annual tradition in Florida. Extending the period for the holiday will give families more time to take advantage of tax savings and markdowns, said Rick McAllister, president and CEO of the Florida Retail Federation.
“Florida retailers appreciate Governor Scott’s support for a longer sales tax holiday. It would be a great boost for Florida’s families and for our retailers. It gives many families whose paychecks come on two-week cycles another chance to take advantage of the sales that retailers offer. Retailers traditionally compete with sales and mark downs to attract shoppers during the tax holiday, and we see an increase in sales because of it,” McAllister said.
The Florida Retail Federation is the statewide trade association representing retailers.
Scott is proposing the expanded holiday as part of his “It’s Your Money Tax Cut Budget” campaign. The proposal is estimated to save Florida households almost $60 million during the 10-day holiday, according to a press release from the governor’s office.
Scott said, “I’m excited to announce that we will work to create another back-to-school sales tax holiday this year, as part of our ‘It’s Your Money Tax Cut Budget.’ Florida families will be able to buy normal school supplies like pens, pencils and paper, as well as computers and clothes without paying state or local sales tax on it. By creating this holiday, we’ll help Floridians keep more of their money, while helping prepare every Florida student for another school year.”
Tax-free items during the holiday include clothing priced less than $100 (including footwear), back-to-school items less than $15 (pens, pencils, notebooks, etc.), and computers and computer equipment less than $750.
A study by The Washington Economics Group that examined the impact of the back-to-school sales tax holiday confirmed that increased spending during the three-day period in 2010 generated $115 million more in taxable sales and $293 million more in overall sales.
That economic boost leads to higher payrolls in the retail industry. Retailers say they typically boost staffing by about 20 percent during the tax holiday weekend to accommodate shoppers. In general, retailers say they get an average increase of between 30 and 40 percent in store traffic over the weekend because of the sales tax holiday.
Tax holiday history
The first sales tax holiday in Florida was enacted in 1998 and ran for seven days, Aug. 15-21. It applied to clothing and footwear valued at $50 or less. It was patterned on a sales-tax-free period first enacted in the state of New York. There have been sales tax holidays in Florida in 1998, 1999, 2000, 2001, 2004, 2005, 2006, 2007, 2010, 2011, 2012 and 2013.
In 2013, the Florida Legislature for the first time included a sales tax break on personal computers and accessories of up to $750.
Florida’s sales tax holiday was expanded in 1999 to a nine-day holiday, spanning two weekends from July 31 to Aug. 8, and the value of tax-exempt clothing raised to $100. The holiday in 2000 was nearly identical. In 2001, school supplies with a selling price under $10 were exempted for the first time, while the clothing exemption was reduced to $50.
After a two-year hiatus, the nine-day holiday returned in 2004 and continued through 2007 with an exemption on clothing under $50 and school supplies under $10. In 2005, to encourage residents to stock up on emergency supplies, Florida added a Hurricane Preparedness Sales Tax Holiday, which continued through 2007.
When the school sales tax holiday returned in 2010, it was a three-day holiday from Aug. 13-15 with exemptions on clothing under $50 and school supplies under $10. The three-day tax holiday was repeated in 2011 from August 12-14, with increased exemptions of clothing up to $75 and school supplies up to $15. In 2012, it ran from August 3-5, and in 2013, it ran from August 2-4.