Thursday, August 01, 2013

Victoria's Secret Elementary School

Year after year, as Virginia's annual "tax free" back-to-school shopping weekend rolls around, I find a reason to take aim at the program and set phasers to mock.

In 2011, for example, I pointed out on how the tax-free holiday is "more complicated than necessary":

Whatever its merits, the sales-tax holiday’s framework is far more complicated than it needs to be. The Virginia Department of Taxation provides a lengthy list of those items that are eligible and others that are ineligible for the sales tax exemption through the weekend. It would have been much simpler for the General Assembly to decree that all consumer items priced at $100 or less would be tax-exempt for the 72-hour period of the tax holiday.

Instead, the list offers a higgledy-piggledy mix of inconsistencies, in which “athletic supporters” are eligible items, but “cleated or spiked athletic shoes” are not. Computers and computer peripherals (like printers) are ineligible, but “all calculators, including those with printing capabilities” are eligible for the exemption.

Some eligible items have little or no relation to school supplies: choir and altar clothing; diapers, children and adult, including disposable diapers; and wedding apparel, including veils, to name a few.
That led to an interview with the Newsplex in Charlottesville in which I noted:
"We have these weird combinations where an athletic supporter is tax exempted but athletic shoes with cleats are not."
My solution?
"Simplify it, simplify it, simplify it."

Sincere suggests tax breaks for anything $100 or less across the board, not just school.

"Easy to understand, much easier for our retailers who have to program their computers."
As far back as 2006, on the occasion of the first such sales-tax holiday in Virginia, I made the same recommendation:
The easiest, most logical, most consumer- and business-friendly thing to do for the tax holiday would simply have been to decree that on this particular three-day weekend, all items with a retail price of $100 or less would be tax-exempt. That would be simple to program into stores' computers, and it would be simple for the average customer -- that is, taxpayer -- to understand.
Then in 2008, I asked:
How about this idea? A tax-free year. Is that too much to hope for?
These reminiscences are prompted by a report by's Virginia bureau, which points out another ridiculous anomaly in the list of acceptably tax-free items:

Planning on buying your daughter some sexy lingerie for her first day back to school this fall?

Well, now you can — free from Virginia state sales tax, thanks to this weekend’s back-to-school clothing and supplies tax holiday.

But, if you’re planning on purchasing some new shin guards for your same soccer superstar daughter who plays on her school’s team, forget it.

That isn’t exempt from the state sales tax during the Friday-through Sunday tax holiday, because state officials decided that doesn’t fall under the category of “clothing.” also points to a compelling "top ten list" of reasons that explain why sales-tax holidays are a flawed idea, if not actually counterproductive, courtesy of the Tax Foundation. It's a PDF but well worth the read.

This year's back-to-school sales-tax holiday begins Friday, August 2, and extends through Barack Obama's birthday on Sunday, August 4.

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