August 2006
Sales Tax Holiday: What about the other 362 days?
As the Governor traveled across the state to promote Tennessee's first sales
tax holiday last Wednesday, members of Tennesseans for Fair Taxation (TFT) were
asking: What about the other 362 days? TFT issued a media statement last week,
followed by TV and newspaper interviews, pointing out the obvious: that the
holiday is only a small gesture that will do little to affect people's lives
year round.
“This tax holiday is great for 3 days of the year, but what about the
other 362 days?” asks Fay Holcomb, spokesperson for TFT. “The fact
is Tennessee has the nation's highest average sales tax while working families
struggle everyday to make ends meet. This does benefit families, but nobody
is helping them with the rest of the year.”
The sales tax holiday is a temporary, three-day sales tax exemption on clothing
and school supplies under $100, and computers under $1500, for August 3rd-5th.
TFT points out that even though the sales tax holiday is intended to benefit
low-income families who are hardest hit by the state's high sales tax, those
who benefit the most are the middle and high-income families who can afford
to buy several months worth of clothes and supplies at once. Most low-income
families live day to day and don't have that luxury.
Chris Daly, TFT chair adds, "While we’re glad Governor Bredesen and
the General Assembly recognize the sales tax is unfair to working families,
the new holiday will, in truth, do little to change things for people who already
pay a larger share of their income in taxes than wealthier families.”
Tennessee not only has the highest sales tax in the nation at 9.4%, but also
has the nation's highest average food tax at 8.4%. “In addition to only
being 3 days long, the holiday doesn't apply to other consumer items, including
food, that are still subject to the sales tax in Tennessee,” states Holcomb.
Daly adds, “If Governor Bredesen is serious about addressing Tennessee's
unfair and exceedingly high sales tax, then he should take real action and reduce
the sales tax all 365 days of the year by passing tax reform.”
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