In a letter sent to President-elect Barack Obama, the National Retail Federation (NRF) asked for three periods of sales tax-free shopping—to exclude alcohol and tobacco sales—lasting 10 days each in March, July and October 2009 to be added to Obama’s coming economic stimulus package. The trade group estimates that it would save consumers about $20 billion, or $175 per family. The goal, of course, would be to revive consumer confidence and spur spending.
Under NRF proposal, the federal government would use bailout money to reimburse the states for the lost tax revenue. State sales tax rates range from 2.9% to 7.25%, the group said. The five states without a sales tax—Alaska, Delaware, Montana, New Hampshire and Oregon—would also receive money.
The Case for and Against a Retail Stimulus Package
"Without swift, additional Congressional measures, the current economic weakness could worsen, creating a more rapid downward spiral—bey... [Read Full Article]