Connecticut will forgo about $3.5 million in sales-tax collections during its annual week-long tax-free holiday that begins Sunday, but that is more than outweighed by the benefits to consumers and retailers, the governor says.
“”Both consumers and retailers benefit from this annual end-of-summer ritual,” said Gov. M. Jodi Rell. “Families get a price break and store owners get increased ‘foot traffic’ in their stores. That’s good for our economy and, in turn, good for keeping and growing jobs – our top mission right now.”
During the 10th annual tax holiday that ends Aug. 21, most individual items of clothing and footwear priced under $300 are exempt from the 6 percent sales and use tax.
For one week only, the increased exemption replaces the standard exemption for clothing and footwear under $50. For purchases costing $300 or more, sales tax is calculated on the full cost of the item.
The state expects to forego about $3.5 million in sales tax revenue from week-long exemption, Rell said.
“But we believe it is well worth that investment to benefit residents and retailers alike,” she added.
