Reprinted from the August 2 Dubuque Telegraph Herald.
After 20 years of administering Iowa’s sales tax holiday weekend in the same way, state officials do not appear interested in making the arrangement more palatable and sensible for consumers.
Nevertheless, it bears repeating: Having tax-free days as we did over the weekend is a pretty nifty advantage for parents getting ready to send kids back to school or off to college. But the arrangement could go from good to great and send shoppers into stores, boosting the economy if the rules weren’t so, well, weird.
Parents in the area are stocking up on school clothes and gym shoes and everything else that goes along with back-to-school shopping. A 7% break on back-to-school staples is welcome. It would be even more welcome if Iowa would expand the list of tax-free items.
Most consumers’ biggest complaint about the sales tax holiday is figuring out when it applies and when it doesn’t. The list of what meets the criteria and what doesn’t is something only politicians or bureaucrats could compose.
Belts are tax free. Belt buckles are not.
Golf shirts are tax free. Golf shoes are not.
Cowboy boots are tax free. Fishing waders are not.
It’s pretty tough to intuit what makes the tax-free list.
Prom dresses, chef’s uniforms, costumes, adult diapers and steel-toed boots are tax-exempt.
Backpacks, football pants, ballet slippers, umbrellas and helmets are not.
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Good luck trying to find the logic in that system.
Here’s a suggestion: If we really want to get people shopping and help out parents as well as retailers, how about making school supplies tax-free? How about all the backpacks and lunchboxes and duffel bags that parents are buying this month?
Here’s another suggestion: What if everything that isn’t food and costs less than $100 were tax free? Wouldn’t that be easier to remember?
Of course, every tax dollar not collected is a tax dollar not hitting state and local coffers. There’s that much less money for schools and streets and such. But, while it’s understandable that government imposes some limits on this “holiday,” the current ground rules appear arbitrary and random.
Expanding the list of exemptions could give parents an even bigger break while bolstering the retail sector. Have you priced school supplies lately? All those pencils and notebooks add up. Throw in dorm-room supplies and we’re talking about a significant expense.
And why should Iowa have all the fun? Illinois has considered adding tax holidays but has never officially done so.
Wisconsin tried out the tax-free holiday last year over five days on a measure approved by Gov. Scott Walker. But under a new grinch ... er, governor ... no such holiday was declared this year. That’s too bad.
Call it a “state stimulus” — this is a great way to keep a little money in the pocketbooks of local families.
Here’s something you might not know: Even if you’re an Iowan on vacation and not available to shop the weekend of the tax holiday, you can still take advantage of the savings. According to the Iowa Department of Revenue, items purchased by mail order, catalog or online are exempt if they are: 1) Delivered during the exemption period, or 2) Ordered and paid for during the exemption period, regardless of delivery date.
So, go get your coveralls, your shoe inserts, your aprons and your lingerie — all of it is tax free. And maybe by next year, Iowa will have uncomplicated the rules and made all goods under a certain dollar limit tax free. That would really give shoppers and retailers something to cheer about.