Tax-Free Weekend underway

Shoppers can start taking advantage of the Tax-Free holiday Friday--stocking up on school supplies and saving money at the same time! 

 

Iowa’s Annual Sales Tax Holiday returns for a 15th year today and Saturday, offering shoppers a deal on select clothing and footwear.

Barry Donovan, general manager of the Westdale Mall JCPenney, said the tax-free holiday will be the biggest weekend for the store since the end of the Christmas season.

“Everybody has to work Friday and Saturday, and we are clearing out our stock room and getting it on the floor,” Donovan said.

Donovan said he expects a 30 percent increase in revenue, and expects customers to be shopping for jeans and tennis shoes. He also said college students usually purchase Hawkeye merchandise and athletic apparel for upcoming football games.

The Iowa Department of Revenue expects the tax holiday to cost the state about $3.6 million in revenue this year, according to department spokeswoman Victoria Daniels.

Last year, she said the sales tax holiday cost state and local governments about $3.4 million in revenue.

There are a number of restrictions on what is and is not covered under the sales tax holiday, Daniels said.

The sales tax holiday does not apply to jewelry, sports equipment or clothing or footwear “designed primarily for athletic activity or protective use and not usually considered appropriate for everyday wear,” according to the Iowa Department of Revenue.

The tax break also does not apply to items being sold for $100 or more.

The sales tax break is only a holiday in name, Daniels said. It’s actually a law the Legislature passed in 2000 that requires all businesses to participate.

“It is something that’s fairly common amongst states,” Daniels said.

The legislation is meant to give Iowa families a little bit of a break when it comes to back-to-school expenses, said State Rep. Ken Rizer, R-Marion.

With four children of his own, Rizer said he has taken advantage of the sales tax holiday in the past and plans to do so this year as well.

While JCPenney expects a major bump, small business owner Mia Suntken said she doesn’t notice an increase at her store during the sales tax holiday.

Suntken, who owns Copper Alligator, a vintage clothing and accessory store in Cedar Rapids, said most of her customers are unaware the sales tax holiday exists when they shop at her store.

“When they don’t have to pay (sales tax) they are like, ‘Oh, that’s nice,’” Suntken said.

She said larger retail stores have an easier time drawing large numbers on the weekend due to large advertising budgets, while smaller stores have to rely on word-of-mouth and social media.