By Bob Katzen
Governor Charlie Baker announced that the annual sales tax-free weekend will take place the weekend of August 29-30. In 2018, the Legislature approved, and Baker signed into law, legislation that made the tax-free weekend an annual event. Prior to that, the decision on whether to have the tax-free weekend was voted upon annually by the Legislature. The annual holiday allows consumers to buy most products that cost under $2,500 on those two days without paying the state’s 6.25 percent sales tax.
“The annual sales tax holiday is an opportunity for us to support small businesses and consumers, and this year, it’s a great way to support our economy that’s been impacted by COVID-19,” said Baker. “This pandemic has created enormous challenges for the commonwealth’s small businesses, and the sales tax-free weekend is one way that we can encourage more economic activity to help Main Street businesses and local economies.”
“Retailers have been hit especially hard by this pandemic,” said Paul Craney, Executive Director of the Massachusetts Fiscal Alliance. “With any luck, the sales tax holiday will begin the healing process for them and start bringing back customers who have grown accustomed to traveling out of state to make their purchases. If we’re really serious about jumpstarting this sector of our economy, serious consideration should be given to expanding the sales tax holiday and extending it to meals as a boost for our struggling restaurants. Other states are serious about getting these sectors of their economies moving again, it’s time for Massachusetts to join them,” Craney concluded.
Not everyone has favored the holiday over the years. Some opponents say the state cannot afford the up to $30 million estimated revenue loss and argue the holiday actually generates little additional revenue for stores because consumers typically buy the products even without the tax-free days. They say that the Legislature should be looking at broader, deeper tax relief for individuals and businesses and not a tiny tax-free holiday. Others say that this tax holiday is unfair when the Legislature has never restored all the local aid, education and other important program cuts made over the past few years.