Gov. Charlie Baker is proposing a two-month sales tax holiday for the months of August and September following a more than $3.9 billion surplus for the fiscal year, which ends on June 30.
Baker will file legislation on Wednesday to expand the annual sales tax holiday. He signed legislation that requires lawmakers to set a tax-free holiday weekend each year. Currently the tax-free weekend is set for August 14 and 15.
The traditional August sales tax holiday applies to purchases under $2,500, and does not extend to meals, motor vehicles, boats, telecommunications services, utilities, tobacco, marijuana or alcohol.
The Department of Revenue also reported that through the middle of June the state already collected 80 percent of what it expected for the full month.
Bob Crane, owner of Crane Appliances in Vineyard Haven, said he thinks the sales-tax free months are “music to my ears.” On the usual sales-tax free weekends, Crane Appliances sees a whole month’s worth of sales. Customers would rush to buy what they want cheaper, similar to Black Friday sales. Sometimes orders are made a whole week before the tax holiday.
“It’s a total disaster and chaos,” said Crane. “Everything happens so fast.”
Extending the sales-tax free weekend into two months will be better for Crane Appliances and consumers, according to Crane. Having the sales-tax free period run from September through August allows everything to run “at a slow comfortable pace.” Crane said his store orders and schedules will be better because of the extended sales-tax free period.
A manager of the Granite Store of Martha’s Vineyard in Edgartown said it is tough to say how the sales-tax free months will affect the store. He said the Granite Store has good products and sales have been strong. The manager did say he thinks people will take advantage of the tax free months to get big-ticket items, like toaster ovens, as they have done during tax free weekends. Additionally, the manager said the weather will affect how much the tax free period helps the store as many on the Island are on vacation during that time.
Gerda O’Rourke, the owner of Timeless in Vineyard Haven, said, “I think it’s great. Anything to help the local economy,” about the sales-tax free months. O’Rourke said the tax-free shopping will be great for sales.
“I think it’s a wonderful boost to the local economy,” said O’Rourke.