Supporting Sunshine State Shoppers
Sales tax holidays have become a popular method for reducing the burden on taxpayers. During these holidays, which typically last three to ten days, certain goods that are usually subject to the sales tax are exempt. The most common holiday is the Back to School Sales Tax Holiday, when sales of clothes and sometimes school supplies, books, and computers are exempt.
Support in the Florida Legislature (generally bi-partisan) has grown for these holidays over time, to the extent that they have become standard, with holidays skipped only in years of recession and budget deficits. The 15 Back to School Sales Tax Holidays held in Florida have saved taxpayers an estimated $543 million.
The impact of increasing discretionary spending in the Sunshine State is very real, as the retail industry is extraordinarily important to Florida’s economy. Florida’s 273,000 retailers employ 2.7 million people, providing one out of every four jobs in the state, pay $49 billion in annual wages, and contribute $155.4 billion in gross domestic product. The sales tax is the most important revenue source for the state of Florida, bringing in $25.2 billion annually. It also provides 78 percent of the state’s General Revenue; the main funding source for education, human services, and public safety.
With the increased use of sales tax holidays, it is essential that the impact on taxpayers, the retail industry, and the state of Florida is thoroughly assessed.