When reform is needed, tax-free weekend is gimmick
Aug 5, 2013 at 9:01 AM
Tennessee is in the middle of a three-day sales tax holiday aimed at giving parents some relief in buying back-toschool supplies for their children. Through Sunday, there will be no sales tax applied to purchases of items such as art supplies, pencils and computers. A sponsor of the sales tax holiday, state Sen. Rusty Crowe, R-Johnson City, noted in a recent news release that “you don’t have to be a student to get the sales tax relief. The holiday applies to clothing and many other items, which helps consumers of any age.”The sales tax holiday is a nice reprieve, but it offers no lasting relief from the state’s oppressive sales tax rate. Tennessee has the highest combined state and local sales tax rate in the nation. Tennessee also taxes food, something that is exempted in 33 other sales tax states. Gov. Bill Haslam signed a measure earlier this year to lower the state’s portion of the sales tax on groceries from 5.5 percent to 5.25 percent. The reduction doesn’t apply to restaurant meals, so you’ll have to eat at home to take advantage of the tax break.Tennesseans for Fair Taxation says this state operates under one of the most inequitable and plainly unfair tax systems in the nation. TFT calculates a family in Johnson City making less than $22,000 a year pays more than three times the taxes as a portion of its income than families with much higher annual incomes.One sensible approach to solving the problem of high sales taxes would be for lawmakers to reform the state’s antiquated tax system. Such reform would allow the state to significantly scale back an oppressive sales tax that weighs the heaviest on poor Tennesseans struggling to feed and clothe their families.Unfortunately, few lawmakers in Nashville are eager to discuss the idea of realistic tax reform. As we’ve said in this space many times before, legislators are perfectly content with the gimmickry of a three-day sales tax holiday.