Budget crunch could squash sales tax holiday weekend

April 19, 2011 4:56:09 PM PDT
The sales tax holiday weekend gives parents a chance to save money when it comes to buying school supplies and clothing items like uniforms and shoes. But the state's $15 to $25 billion budget shortfall could bring the savings to an end.

School is not out yet and back to school supplies are probably not the top thing on your mind right now, but legislators are looking at the state tax free weekend and may cut it for two years to help balance the budget.

The Texas tax free holiday lets parents buy school supplies with out paying the 8.25 percent sales tax. It's not a lot, but when coupled with store discounts, families can save money on a host of back to school items. But the tax free weekend may go on a two-year hiatus as state legislators try to cut a 15 to $25 billion budget shortfall. Letty Garza says cutting the tax free weekend to balance the state budget is OK.

"I think I would rather pay a couple of extra dollars, what it is $8 per $100? And have a teacher have their jobs or have disabled kids have benefits and stuff like the special programs they are trying to get rid of," said Garza.

The state estimates Texans saved more than $46 million last year and nearly a half billion since the tax free weekend first started. Debbie wWfford has never taken advantage of the savings, but sees why it is important to keep.

"I think for the people who are disadvantaged and need it for a family, I think it would be a real shame to do away with it for them," said Wofford.

For other moms, the tax free weekend helps them get ready for school. Cheryl Young has five grand kids and says a two-year pause in the tax free weekend should not be an option.

"I don't think that is fair; it is not fair because we are struggling and that helps us we really need that for our children," Young said.

State Senator Rodney Ellis helped pioneer the state sales tax holiday, and from Austin he told us, "The sales tax holiday is primarily a tax break for working Texas families. If we are going to ask them to sacrifice, I think it's only fair that we ask corporations profiting in the billions to sacrifice what they receive in tax giveaways as well."

Right now, the two year suspension is still being discussed, but it did make its way out of a House committee. If approved, the sales tax weekend would go away in 2012 and 2013. The tax free weekend this year will still go on as planned.

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