• Publications
    • Essay
    • Case Study
    • Policy Study
    • Report
    • Testimony
    • Other
    • Newsletter
  • Blog
    • Daily Blog
    • Podcasts and Radio
    • Video
    • Infographics
    • Commentary / Op-Eds
    • Events
  • Events
  • Donate
  • About
    • Our Team
    • Show-Me Institute Board of Directors
    • Fellows and Scholars
    • Our Authors
    • Jobs
  • Contact
  • Explore Topics
    • Education
      • Accountability
      • Education Finance
      • Performance
      • School Choice
    • Health Care
      • Free-Market Reform
      • Medicaid
    • Corporate Welfare
      • Special Taxing Districts
      • Subsidies
      • Tax Credits
    • Labor
      • Government Unions
      • Public Pensions
    • State and Local Government
      • Budget and Spending
      • Courts
      • Criminal Justice
      • Municipal Policy
      • Property Rights
      • Transparency
      • Transportation
    • Economy
      • Business Climate
      • Energy
      • Minimum Wage
      • Privatization
      • Regulation
      • Taxes
      • Welfare
      • Workforce
Show Me InstituteShow Me Institute
Show Me InstituteShow Me Institute
Support the Show-Me Institute
  • Publications
    • Essay
    • Case Study
    • Policy Study
    • Report
    • Testimony
    • Other
    • Newsletter
  • Blog
    • Daily Blog
    • Podcasts and Radio
    • Video
    • Infographics
    • Commentary / Op-Eds
    • Events
  • Events
  • Donate
  • About
    • Our Team
    • Show-Me Institute Board of Directors
    • Fellows and Scholars
    • Our Authors
    • Jobs
  • Contact
  • Explore Topics
    • Education
      • Accountability
      • Education Finance
      • Performance
      • School Choice
    • Health Care
      • Free-Market Reform
      • Medicaid
    • Corporate Welfare
      • Special Taxing Districts
      • Subsidies
      • Tax Credits
    • Labor
      • Government Unions
      • Public Pensions
    • State and Local Government
      • Budget and Spending
      • Courts
      • Criminal Justice
      • Municipal Policy
      • Property Rights
      • Transparency
      • Transportation
    • Economy
      • Business Climate
      • Energy
      • Minimum Wage
      • Privatization
      • Regulation
      • Taxes
      • Welfare
      • Workforce
Economy / Taxes

Why Did the Sales Tax Cross the Road?

By Sarah Brodsky on Mar 14, 2008

To try to stimulate the economy, Missouri may get another sales tax holiday:

For three days in June, the GOP is proposing to exempt any product costing up to $600 from state or local sales taxes.

"The hope is the state can give a little boost to get people out spending," said the plan’s sponsor, Rep. Mike Sutherland, R-Warrenton.

I’ve already argued against sales tax holidays and failed to convince. But I’ll try again. If a sales tax holiday is a good thing, then why limit it to school supplies? Why not include anything under $600? Why not get rid of the limit? If a three-day holiday is a good idea, wouldn’t three weeks or three months be better? How about all year?

Would people go crazy buying stuff all year round if we got rid of the sales tax entirely? Probably not. They might buy a bit more because things are cheaper. They might be a little more likely to buy something in a store than to order it online. But we would also see a drop in tax revenue, and there wouldn’t be a 365-day shopping spree to make up for it.

So why do people run out to the store for a three-day holiday if they wouldn’t do that for a longer one? If, for example, people are going to buy school supplies sometime in August anyway, they might as well do that during the sales tax holiday. So everyone postpones their trip to the store until those three days and buys all the stuff they would have bought during the week before. To legislators, that looks like a magical economy booster. To me, that looks like switching around people’s shopping days for no good reason.

I guess this year we’ll see whether it works any better in June than in August.

  • Share
  • Tweet
  • Share
  • Email
  • Print
About the author

Sarah Brodsky

More about this author >
Footer Logo
Support the Show-Me-Institute
Showmeinstitute.org is brought to you by Show-Me Institute and Show-Me Opportunity.
  • Publications
  • Blog
  • Events
  • Donate
  • About
  • Contact

Reprint permission for Show-Me Institute publications and commentaries is hereby granted, provided that proper credit is given to the author. We request, but do not require, that those who reprint our material notify us of publication for our records: [email protected]

Mission Statement
Advancing liberty with responsibility by promoting market solutions for Missouri public policy.

© Copyright 2023 All Rights Reserved