Merchant: Sales tax holiday draw more customers spending more money every year



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COLUMBUS, Mississippi — Lex Jackson has owned Reed's Department Store in Columbus for 42 years, including the past 18 at the store's current location in Jackson Square.

Over that time, he has learned more than a few things about the quirks of the modern consumer.

Take, for instance, the annual Mississippi Sales Tax Holiday, which is scheduled this year for the weekend of July 31-Aug. 1.

The holiday, which began in 2009, is scheduled close to the start of the school year and is widely regarded as a "back to school" discount. During the tax holiday, the state waives its 7 percent sales tax on clothing and footwear that cost less than $100 per item.

A shopper that spends $300; saves $21.

"It's the funniest thing," Jackson says. "We price something at 50 percent off and people will just shrug and walk right on by. But on that sales tax holiday, people just go crazy. I've seen people come up to cashier with a $20 T-shirt and when we tell them there's no tax, they say, 'Wait a minute. Let me go back and get another one.' They're saving — what — $1.40?

"You know, I think maybe they just feel like they're sticking it to the government or something. I just don't know. There's some psychological aspect of it that is hard to understand," he said.

The holiday begins a minute after midnight on Friday morning, July 31, and continues until midnight Saturday, Aug. 1.

Jackson says the event seems to draw more and more customers spending more and more money every year.

"The thing we do that maybe some other stores don't like is we take the sales tax off everything," Jackson said. "It's just too confusing to have to explain why it applies to one item and not another. So we just absorb the sales tax on those items that aren't eligible."

Jackson said he would like to see the sales tax holiday extended to a much broader range of "back to school" items, even those items he does not sell.

"You see those supply lists that parents are sent every year and I've always wondered why the state doesn't look at those lists and say, 'OK, these supplies will be tax-exempt, too,'" he said. "That would make sense to me."

The Mississippi Department of Revenue has posted this on its website regarding the Sales Tax Holiday: "Clothing and footwear items, meant to be worn next to the body and cost less than $100 per item, are exempt from sales tax during this period. Accessories such as jewelry, handbags, wallets, watches, backpacks, and similar items do not qualify for the Sales Tax Holiday. Cleats and items worn in conjunction with an athletic or recreational activity are other sample items not eligible. School supplies and computers are not included."


Information from: The Commercial Dispatch, http://www.cdispatch.com

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