Retailers Brace For Annual Tax-Free Weekend

State Comptroller Susan Combs expects Texans to save almost $80 million from the annual sales tax holiday that begins tomorrow night. Houston state Sen. Rodney Ellis, D-Houston says families have benefited from the savings over the past 15 years.

The annual tax break on certain items runs through Sunday as families prepare to send children back to school.  The law was authored by state Sen. Rodney Ellis, D-Houston in 1999.

“And a lot of states were beginning to talk about it, but very few had passed it. New York and Florida in particular got my attention, which is why I wanted to do it. The Comptroller expects that Texans will save another $79 million dollars in sales taxes this weekend by not having to pay them. Over the years, this tax break has given Texas consumers about $700 million dollars in tax relief.”

It exempts most clothing, footwear, school supplies and backpacks priced under $100 dollars from sales taxes.

Ellis thinks it should be more.

“The cost of inflation and common sense would tell you we ought to go up on the dollar amount. We were successful over the years at expanding the items in the legislation, so most of the items that I can think of are included. We need to include computers. There are several states that do give a sales tax break for back-to-school computers, and we ought to do that in Texas.”

In the 15 years Texas has offered the tax-free weekend, it has become one of the biggest generators of business for retailers.

“The largest shopping holidays in Texas are Thanksgiving, Christmas and New Year’s. This clearly the fourth. This is like Christmas in August for so many people.” 

He says consumers will benefit from moving the tax-free weekend a week earlier than in the past.

“Although, on one hand it’ll cost the state $79 million dollars, it generates money. Overall, it’s a net gain to the state because when people go to shop for these back-to-school items, they’re gonna buy other items that over $100 dollars. This will be one of the largest shopping days of the summer. This will be the largest shopping day in Texas since the New Year’s sales.”

Ellis says with more retailers joining the list, it gives shoppers more places to save away from the big box stores.

Jennifer King is a buyer for the Houston Museum of Natural Science, not a place where shoppers would normally expect to find tax-free items.

“We are participating in the statewide tax-free holiday. It includes all apparel, school supplies, backpacks, shoes and a lot more. It gets a little bigger every year, and since we’ve launched our online store, we’re anticipating some online shoppers this year for the first time too.”  

The tax holiday runs from midnight Friday through midnight Sunday.