Maryland’s top tax man says the state’s annual week-long sales tax holiday, which starts on Sunday and runs to Aug. 17, is having a big impact.
Comptroller Peter Franchot (D) stopped by Westfield Montgomery on Friday morning to promote “Shop Maryland,” the state’s sales tax-free week scheduled for the second week of August and back-to-school clothes shopping.
“This is the second busiest shopping week of the year. That’s extraordinary considering it’s the down time of August,” Franchot said. “When you take the 6 percent sales tax off these items, it attracts lots of people to come and shop. There’s probably a double-digit increase in sales during the week.”
The sales tax holiday applies only to clothing and shoes priced $100 or less. Franchot said he would like to see the holiday expanded in next year’s General Assembly to cover school supplies, such as backpacks. The General Assembly established the tax-free week in the 2007 special session.
The state loses about $5 million in sales tax revenue each year because of it, but Franchot said it’s gotten a positive response from citizens.
“Other people have kidded and said can we have it expanded to like a month. We can’t afford that, but we can expand it to cover some items that other states cover,” Franchot said.
Pat Donoho, president of the Maryland Reatilers Association, said people have taken notice of the program, even if the savings are relatively small.
“People plan for this now and from out standpoint, that is great public policy,” Donoho said.