Tax-free holiday a double-edged sword for Tennessee - WMC Action News 5 - Memphis, Tennessee

Tax-free holiday a double-edged sword for Tennessee

By Jamel Major - bio | email | Twitter | Facebook

MEMPHIS, TN (WMC-TV) - Tennessee shoppers are catching a break this weekend, but not everyone thinks the tax-free holiday is a good idea during these trying economic times.
    
Faced with a serious decline in revenue, Governer Phil Bredesen has already been forced to cut millions of dollars from the state's budget.

He says three days of tax exemptions in the fall have already been built into the budget. But the annual tax-free weekend in the spring will not be included in plans for 2010.

"I'm very careful about the expenditures of the state. This obviously represents probably about a $12 million expenditure," said Bredesen. "We did not, this year, provide for the one next spring. But this summer was designed as a back-to-school weekend. I think people do need that help."

Best Buy employee Jason Sampson said the tax-free holiday has its benefits, as well as its risks. 

"This year we've skipped the April tax-free at the governor's request, and we're only doing the one tax-free in August," he said. "So, it's a very big concern from the state of not taking that revenue that we need to pay bills or make the government run," Smpason continued.

"However, the increase in revenue that it really brings to kickstart the economy...it's kind of a double-edged sword."

The August tax-free holiday is meant to help parents pay for back-to-school items, and shoppers like Sarah Fahrer say it's a big help.

"There's a lot of stuff kids need to buy.  Paper, pencils...Lord knows what else," she said.

Click here for more information about the sales tax holiday.

 

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