Rebate checks expected to boost S.C. sales tax holiday

By Candace Jarrett
Morning News Reporter
Published: July 26, 2008

FLORENCE — The Pee Dee still has one week until South Carolina’s annual three-day sales tax holiday, but the anticipation of not paying sales tax during a time when the nation has a gloomy economic outlook has some people out window shopping already.

“(I’m) just looking around at the laptops for the back-to-school no-tax weekend,” Melissa Erwin said while inside Florence’s Best Buy on Thursday morning. “With three kids, it’s tremendous to not have to pay taxes.”

Erwin said although she’s already purchasing back-to-school clothing and school supplies for her children, the big-ticket items are what she saves for the tax-free weekend.

“If we find stuff while we’re out, we’ll get it,” she said. “But it really helps with the big-ticket items. It’s very important because every little bit that you save helps.”

The holiday — the third biggest shopping weekend of the year in the Palmetto State — will begin at 12:01 a.m. Friday and end at midnight Aug. 3.

The 6-percent state sales and use tax, and any applicable local sales and use tax, will not be imposed on clothing, footwear, school supplies and computers.

Jewelry, cosmetics, furniture, rental of clothing or footwear, items for use in a business, or items placed on layaway or similar deferred payment and delivery plans are excluded from the tax exemption.

According to the National Retail Federation’s 2008 Back to School Consumer Intentions and Actions Survey, this year’s economic stimulus rebate checks will play a major role in shopping patterns.

One-fifth of parents nationwide have set aside a portion of their stimulus check for back-to-school purchases, according to survey, which was conducted by BIGresearch on 8,361
respondents.

The survey shows spending in most categories is expected to remain flat and not top last year’s figures. The survey shows electronics spending will continue to rise, however, with parents spending some of their rebate check on computers and cell phones.

Patrick Langston, Best Buy’s general manager in Florence, agrees with the survey.

“We’ve actually see the complete opposite of spending everywhere else,” he said. “We are definitely expecting an extremely busy weekend. (The) tax holiday has traditionally been one of our biggest shopping weekends of the year, and this year we expect nothing different.”

With inflation, parents are expected to spend $151 on electronics purchases during the back-to-school time frame this year, up from $129 last year, according to the survey.
Spending on clothing will increase to $234 from $231 last year, the survey shows. Shoe spending will increase to $109 from $108 last year and school supplies will cost $98 instead of $94.

“I think with gas prices the way they are and the economy the rate it is today, I expect a huge turnout this year to take advantage of the additional discounts,” Langston said. “There will be an extreme amount of customers in a short time period that are wanting to get these kids prepared to go back to school.”

A majority of consumers— about 73 percent — will head to discount stores for back-to-school purchases this year in an effort to stretch their dollar as far as possible, according to the survey. An estimated 56 percent will head to department stores, 47 percent to clothing stores, 21 percent to electronic stores, 42 percent to office supply stores and 18 percent to drug stores.

The survey also shows that with more people comparison shopping as gasoline prices steadily rise, 24 percent of back-to-school shoppers will buy online, compared with 21 percent last year.

“This year’s back-to-school shopper is a bargain hunter at the core,” Phil Rist, vice president of Strategy at BIGresearch, said in a press release. “Though parents want to make sure kids are fully prepared for school, they will be comparing prices online and in stores before making any big purchases.”

An item qualifying for the holiday will be exempt if the eligible item is both delivered to and paid for by the customer during the three days of the holiday; the eligible item is ordered and paid for by the customer; and the order is accepted by the retailer during the holiday for immediate shipment, even if delivery is made after the holiday.

Anyone with questions about the sales tax holiday should call the state Department of Revenue at (803) 898-5788 or e-mail .

— Morning News staff writer Kevin Smetana contributed to this report.