No sales tax holiday may send shoppers out of state

Georgia will not have a sales tax holiday for back-to-school shoppers this year, but most neighboring states will forgo sales taxes on select items for a weekend. That combination could send some Georgia shoppers, especially those who live close to a state line, out of state for many purchases.

Sales tax rates in Georgia range from 6 percent to 8.9 percent, with most counties charging 7 or 8 percent. Shoppers who live near the state line, and have a store just into the neighboring state, it could add up to real savings. For shoppers who live far from the state line, the cost in travel and time can really reduce any savings.

For example, a family in Macon that wanted to shop at a Walmart in Phenix City, Ala., would spend more than three hours driving. If they were driving a car that gets 25 mpg at current gas prices, it would cost about $17.60 in gas. To just break even – money wise — with the 7 percent rate in Bibb County, the family would have to purchase more than $250 in exempt items. Of course a similar family living in Columbus, maybe 10 minutes away, stands to pocket a lot more savings by driving over.

James Miller, a spokesman for both the Georgia Retail Association and the Florida Retail Federation, agreed the decision to shop out or state would depend both on the size of the budget and the distance from the state line.

“I don’t know that it will be so much for smaller school supplies,” he said when asked if crossing state lines could become a trend. “Now for technology, that is different.” Florida will exempt the first $750 per item for certain computers and accessories. If a family has multiple children and a total budget of $2,000 for exempted items, the savings could be up to $160.

He said he was unaware of any effort by merchants in either state to either keep shoppers near home or lure them away. That could be, he said, because many shoppers are loyal to certain stores, and those chains don’t care which location a shopper visits as long as it is within the brand.

Still, he said stores and communities in the Sunshine State are eager for any shoppers who may drive south. “That is what Florida is hoping for,” he said.

Each state has its own list of qualifying goods, but most are clothing and shoes up to a certain cost, back-to-school supplies such as pencils and paper and technology.

In Georgia, the tax-free weekend has long been popular with families, but it has been criticized by tax experts. They say the holiday does not increase spending. Rather, spending is simply concentrated within a single weekend rather than over several weeks. And it comes at a huge cost to the state’s coffers. Tax groups estimated that about $75 million in sales tax was not collected during the tax holiday last year.

Dates of sales tax holidays in neighboring states