A tax holiday is a temporary reduction or elimination of a tax. It is synonymous with tax abatement, tax subsidy or tax reduction. Governments usually create tax holidays as incentives for business investment, although the arrangement has also been characterized as a form of corporate welfare that leads to a redistribution of resources away from smaller businesses and private citizens and towards monopolies and other forms of consolidated wealth.
Tax relief can be provided in the form of tax concessions to assure the investment of new businesses or the retention of existing ones.[1] Tax holidays have been granted by governments at national, sub-national, and local levels, and have included income, property, sales, VAT, and other taxes. Some tax holidays are extra-statutory concessions, where governing bodies grant a reduction in tax that is not necessarily authorized within the law. In developing countries, governments sometimes reduce or eliminate corporate taxes for the purpose of attracting foreign direct investment or stimulating growth in selected industries.
A tax holiday may be granted to particular activities,[2] in particular to develop a given area of business,[3] or to particular taxpayers.[4] Researchers found that on sales tax holidays, households increase the quantities of clothing and shoes bought by over 49% and 45%, respectively, relative to what they buy on average.[5]
In New York, a statewide sales tax holiday was first enacted by the New York legislature in 1996, enabling the first tax-free week in January 1997. Local governments in New York were given the option of whether or not to participate; most accepted.[6] Since then, the initiative has been adopted by thirteen states. It commonly takes the form of tax-free weekend lasting Friday through Sunday, usually during a major shopping period for necessities, such as just before school starts. During that period, sales tax is not collected on selected items, such as clothing and school supplies. The items subject to the sales tax exemption may also be restricted by price (e.g., clothing up to $100), but consumers are free to buy unlimited quantities of the included items.
As with other sales taxes, visiting residents of non-participating states who purchase tax-free goods (holiday or not) may still have to pay use tax on the goods they take home.
clothing, school supplies, green appliances, hurricane preparedness items
May, August, October
3
Five US states (Alaska, Delaware, Montana, New Hampshire, and Oregon) do not impose general sales taxes at all but may have excise taxes on specific categories of goods such as gasoline, E911, cigarettes, alcohol, or meals. See Sales taxes in the United States for details.
Some governments create tax-free weekends as incentives for business investment.
Referencesedit
^Caves, R. W. (2004). Encyclopedia of the City. Routledge. p. 658. ISBN978-0415862875.
^For example, Indonesian tax holidays for certain investments.
^For example, New Jersey's Urban Enterprise Zones.
^For example, New York City property tax reduction programs 2011-03-12 at the Wayback Machine.
^Federal Reserve Bank of Chicago, The Effect of Sales Tax Holidays on Household Consumption Patterns, July 2010
^. Archived from the original on 23 April 2006. Retrieved 15 April 2009.
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The examples and perspective in this article may not represent a worldwide view of the subject You may improve this article discuss the issue on the talk page or create a new article as appropriate December 2010 Learn how and when to remove this message A tax holiday is a temporary reduction or elimination of a tax It is synonymous with tax abatement tax subsidy or tax reduction Governments usually create tax holidays as incentives for business investment although the arrangement has also been characterized as a form of corporate welfare that leads to a redistribution of resources away from smaller businesses and private citizens and towards monopolies and other forms of consolidated wealth Tax relief can be provided in the form of tax concessions to assure the investment of new businesses or the retention of existing ones 1 Tax holidays have been granted by governments at national sub national and local levels and have included income property sales VAT and other taxes Some tax holidays are extra statutory concessions where governing bodies grant a reduction in tax that is not necessarily authorized within the law In developing countries governments sometimes reduce or eliminate corporate taxes for the purpose of attracting foreign direct investment or stimulating growth in selected industries A tax holiday may be granted to particular activities 2 in particular to develop a given area of business 3 or to particular taxpayers 4 Researchers found that on sales tax holidays households increase the quantities of clothing and shoes bought by over 49 and 45 respectively relative to what they buy on average 5 Sales tax holidays in the United States editNot to be confused with Legal holidays by state In New York a statewide sales tax holiday was first enacted by the New York legislature in 1996 enabling the first tax free week in January 1997 Local governments in New York were given the option of whether or not to participate most accepted 6 Since then the initiative has been adopted by thirteen states It commonly takes the form of tax free weekend lasting Friday through Sunday usually during a major shopping period for necessities such as just before school starts During that period sales tax is not collected on selected items such as clothing and school supplies The items subject to the sales tax exemption may also be restricted by price e g clothing up to 100 but consumers are free to buy unlimited quantities of the included items As with other sales taxes visiting residents of non participating states who purchase tax free goods holiday or not may still have to pay use tax on the goods they take home State Or Capital Items Included Period Days Alabama 7 clothing computers school supplies books severe weather preparedness 3rd weekend in July last weekend in February 3 Arkansas 8 clothing school supplies books 1st weekend in August 2 Connecticut clothing 3rd week in August 7 District of Columbia 9 Repealed Florida clothing school supplies books 2nd week in August 3 Georgia U S state clothing school supplies computers 1st weekend of August REPEALED FOR 2017 4 Iowa clothing 1st weekend of August 2 Louisiana 10 all TPP 2 500 hurricane preparedness items 1 500 firearms ammunition and hunting supplies 1st weekend of September 2 Massachusetts 11 Most items for which the sales tax would normally apply purchases up to 2500 included 2nd weekend of August 2 Maryland 12 clothing amp footwear August 14 20 7 Energy star products Feb 19 21 2011 3 Missouri 13 clothing school supplies computers 1st weekend in August 3 New Mexico clothing school supplies computers 1st weekend of August 3 North Carolina Repealed as of July 1 2014 Oklahoma clothing 1st weekend of August 3 South Carolina clothing school supplies computers 1st weekend of August 3 Tennessee 14 clothing school supplies computers Last Friday of July 3 Texas 15 emergency supplies e g batteries flashlights 3rd weekend of April 3 Texas 16 electrical products e g air conditioners light bulbs with the Energy Star label Memorial Day weekend in May 3 Texas 17 water products e g toilets soaker hoses with the Water Sense label Memorial Day weekend in May 3 Texas 18 clothing diapers backpacks school supplies 2nd weekend of August 3 Virginia clothing school supplies green appliances hurricane preparedness items May August October 3 Five US states Alaska Delaware Montana New Hampshire and Oregon do not impose general sales taxes at all but may have excise taxes on specific categories of goods such as gasoline E911 cigarettes alcohol or meals See Sales taxes in the United States for details Some governments create tax free weekends as incentives for business investment References edit Caves R W 2004 Encyclopedia of the City Routledge p 658 ISBN 978 0415862875 For example Indonesian tax holidays for certain investments For example New Jersey s Urban Enterprise Zones For example New York City property tax reduction programs Archived 2011 03 12 at the Wayback Machine Federal Reserve Bank of Chicago The Effect of Sales Tax Holidays on Household Consumption Patterns July 2010 Oct Nov State Legislatures magazine On Holiday from the Sale Tax Archived from the original on 23 April 2006 Retrieved 15 April 2009 Sales Tax Holidays Archived copy PDF Archived from the original PDF on 13 August 2011 Retrieved 25 July 2011 a href Template Cite web html title Template Cite web cite web a CS1 maint archived copy as title link Sales Tax Holiday Repealed otr otr cfo dc gov Home Page Louisiana Department of Revenue www revenue louisiana gov It s official The Massachusetts sales tax holiday is happening after Gov Charlie Baker s sign off masslive com 10 August 2018 Shop Maryland the state s tax free week Archived from the original on 7 August 2011 Retrieved 8 August 2011 Back to School Sales Tax Holiday MO gov Website Retrieved 31 July 2011 Tennessee Sales Tax Holiday Emergency Preparation Supplies Sales Tax Holiday Texas Comptroller of Public Accounts Retrieved 22 April 2023 Energy Star Sales Tax Holiday Texas Comptroller of Public Accounts Retrieved 22 April 2023 Water Efficient Product Sales Tax Holiday Texas Comptroller of Public Accounts Retrieved 22 April 2023 Sales Tax Holiday Texas Comptroller of Public Accounts Retrieved 22 April 2023 External links editThis article s use of external links may not follow Wikipedia s policies or guidelines Please improve this article by removing excessive or inappropriate external links and converting useful links where appropriate into footnote references January 2023 Learn how and when to remove this message 2008 State Sales Tax Holidays Archived 2020 02 14 at the Wayback Machine Federation of Tax Administrators Alabama Connecticut District of Columbia Georgia Iowa Louisiana Missouri New Mexico North Carolina Oklahoma South Carolina Tennessee Archived 2015 04 12 at the Wayback Machine Texas original holiday Texas emergency supplies holiday Vermont Virginia West Virginia Retrieved from https en wikipedia org w index php title Tax holiday amp oldid 1207834522, wikipedia, wiki, book, books, library,
