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Ohio's second-ever sales tax-free holiday is this weekend

by Marc Kovac | Capital Bureau Chief Published: August 3, 2016 6:46 PM

Columbus -- Retailers are hoping for another windfall, as back-to-school shoppers take advantage of the state's second-ever sales tax-free holiday this weekend.

Lawmakers extended the three-day event another year, with the tax break offered on Friday, Saturday and Sunday (Aug. 5, 6 and 7) on specified purchases.

"Consumers looking for bargains know they can find them next Friday through Sunday," Gordon Gough, who heads the Ohio Council of Retail Merchants, said in a released statement. "The sales tax holiday became a mini-Black Friday in many communities, as consumer groups and school organizations across Ohio drove their members to the malls and stores to save money. This year should be just as exciting."

Ohio's first sales tax holiday took place a year ago, after lawmakers, following years of debate, agreed to try it. Lawmakers finalized a second sales tax holiday before they broke for their summer recess, with the same provisions as the first, though the legislature will have to act again to allow future sales tax-free weekends.

Over the coming weekend, shoppers will not have to pay sales tax on clothing items priced up to $75 and school supplies and instructional materials up to $20, whether purchased in stores or through online retailers.

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The exemption does not cover computers and other electronics, sports equipment, hair accessories or higher-priced clothing and supplies.

About 17 other states have comparable sales tax holidays in place, most with limits similar to Ohio's. A study released earlier this year by the University of Cincinnati's Economics Center showed that last year's event boosted sales tax collections by $4.7 million

Not all groups support the sales tax holidays, however. The Institute on Taxation and Economic Policy, in a memorandum released last month, said the events benefit higher-income households most, provide "no significant retail boost" and result in some revenue loss.

According to the group, "Sales tax holidays may give consumers a short break from sales taxes on certain items, but they don't change regressive state tax systems. Policymakers should instead consider policies that make our tax system fairer, such as a low-income refundable sales tax credit or a state earned income tax credit."

Marc Kovac is the Dix Capital Bureau Chief. Email him at mkovac@dixcom.com or on Twitter at OhioCapitalBlog.


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