Late last week the Massachusetts legislature passed, and the Governor signed, legislation making Massachusetts the 17th state to offer a back-to-school sales tax holiday. This is the same Deval Patrick who recently said he supported the legislation “frankly, not because it is particularly fiscally prudent, but because it is popular…. People want it."
We couldn’t agree more. Sales tax holidays may be politically popular, but they are poor fiscal policy. There’s scant evidence they make a long term difference for retailers, and they fail to target tax relief to those consumers most in need.
The holidays can also be costly to the treasury (Massachusetts expects to lose $20-25 million) and create administrative headaches.
We hope Governor Patrick will take a look at our brief on sales tax holidays between now and next year; it will give him the facts and courage he needs to say no to lousy policy.
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