For the first time since 2015, it looks like Massachusetts will have a sales tax holiday after all.
The state Senate had rejected a proposal in May to bring back the tax-free weekend after its two-year absence, and a bill signed by Gov. Charlie Baker in June making the holiday a permanent summer fixture doesn’t take affect until 2019. So there was a degree of uncertainty around whether 2018 would be the third-straight year that Bay Staters would have to pay a sales tax all 365 days.
Less so now.
Among the final measures lawmakers passed on the final day of the formal legislative session Tuesday was an economic development bill that includes a two-day sales tax-free weekend this month, Aug. 11-12. The sales tax holiday was approved by the House last month and included in the Senate bill through an amendment by Minority Leader Bruce Tarr, a Gloucester Republican. The Senate approved Tarr’s amendment 31-6 last Wednesday.
Baker has been a consistent supporter of the sales tax holiday, which retailers favor. However, state lawmakers decided to forgo the holiday in 2016 and 2017, citing lost revenue and research showing that it merely shifted the timing of consumer spending. Before that, the tax-free weekend had taken place in Massachusetts every year except for 2009 since it was first implemented in 2004.
So what is it good for?
The holiday eliminates the state’s 6.25 percent tax on that Aug. 11-12 weekend for all retail goods, with a number of exceptions, including single items over $2,500, meals, motor vehicles, motorboats, and tobacco products. So it will be of no help to those who were waiting to buy a car or load up on cigarettes.
The sales tax holiday also excludes marijuana or marijuana products. But that may be somewhat of a moot point, considering no retail recreational dispensaries are open yet and medical marijuana isn’t subject to the state’s sales tax.