Back to School Savings
Senator Devin LeMahieu
September has arrived and school is back in session. For students, it’s back to homework. For parents, it’s back to the bank account with the return of dreaded back to school shopping. In 2015 alone, parents spent $3.8 billion on school supplies across the country. This year, it’s estimated that the average K-12 family will spend $100 per student on school supplies, up 12 percent from last year. Combined with new clothes, lunches, and sports gear- the costs can quickly add up. That’s why I authored Senate Bill 627 last session, which proposed an annual sales tax holiday in August for back to school items, such as notebooks, backpacks, computers, and clothing.
This idea has picked up steam recently, with Governor Walker announcing last week that a “Back to School” sales tax holiday will be included in his 2017-19 biennial budget. Similar to Senate Bill 627, Governor Walker’s sales tax holiday proposal would last two days beginning on the first Saturday of August 2017 and would include school supplies, computers costing less than $750, and clothing items costing less than $75 each.
Some opponents have dismissed the idea, calling it minor tax relief or a gimmick. However, the sales tax holiday would save Wisconsin parents an estimated $11 million in taxes annually. This year seventeen other states, including neighboring Iowa, are utilizing a sales tax holiday.
In addition, the University of Cincinnati recently studied the effects of Ohio’s new sales tax holiday. They found overall sales increased 6.5% in August 2015 and generated a net increase in sales tax collections of $4.7 million. Border counties experienced higher growth rates as the sales tax relief brought people in from neighboring states to make purchases.
The back to school sales tax holiday will also benefit traditional “brick and mortar” retail stores. Currently, online stores hold a competitive advantage because they often don’t need to charge sales tax on purchases. The sales tax holiday event will generate traffic to traditional stores and help boost overall sales on all items, not just those that are tax exempt, much like Black Friday or other holiday sales. A sales tax reduction will offer support to local businesses and workers by leveling the playing field in the new online shopping era.
Wisconsin families deserve a state discount on necessary school supplies. Providing a sales tax holiday will help middle class budgets and ensure their dollars go a little further.
Senator Devin LeMahieu (R-Oostburg) chairs the Senate Elections and Local Government Committee and serves the 9th Senate District, which includes portions of Calumet, Manitowoc, and Sheboygan Counties.