Annual sales tax holiday good for economy

Alabama’s sixth annual sales tax holiday begins on Friday, Aug. 5 and ends at midnight on Sunday, Aug. 7. In a political environment where our government’s fiscal policies often cause more headache than any sort of relief, it is nice to see one exception to our dysfunctional tax code.

The state and federal government rarely create good tax policies but in 2006, the Alabama Legislature enacted an annual sales tax holiday. As a member of the House at that time and a co-sponsor of the bill, I felt like this would be a step in the right direction for relieving the tax burden on those preparing their children to go back to school.

This three-day event allows all Alabamians — not just those going back to school — to shop for clothes, computers, school supplies and books without paying the 4 percent sales tax imposed by the state. If there is anything on your list of necessities or even something whimsical you wish to buy in those categories mentioned above, this holiday is the time to act. I urge you to take advantage of this weekend designed to give Alabama’s families a tax break.

In addition to the state waiver of sales taxes, a record 271 localities have also announced they will participate in the holiday, including many in Shelby County. The average family with school-aged children in this part of the country will spend approximately $615 on back-to-school items this year, almost $111 more than what they were expected to spend last year.

If you participate in the sales tax holiday, you are helping the economy of Alabama. August 2010 state sales tax collections grew by more than $6 million over the same month sales in 2005 when the state didn’t have a sales tax holiday. This weekend is a big boon for Alabama’s retail community, usually coming in right behind the after-Christmas sales season.

My household takes advantage of the sales tax holiday every year. It saves my wife and me a significant amount of money as we buy clothes and back-to-school items for our school-aged daughter. I urge you to participate in Alabama’s sales tax holiday August 5-7. For more information, go to Revenue.alabama.gov and click on the link to the Sales Tax Holiday.

Cam Ward is a state senator from Alabaster.