As families across the state start back-to-school shopping, they’ll no longer benefit from the state’s annual sales tax holiday on school supplies.
Gov. Phil Murphy and legislators ended the two-year-old tax break last month, a move that has sparked debate amid ongoing inflation concerns. The New Jersey Division of Taxation announced the cancellation earlier this month, instructing retailers to again charge sales tax on eligible supplies.
According to the latest data, traditional supplies have seen a more than 20% price increase, heightening the financial burden on parents and students.
The sales tax holiday that had been in effect for 10 days in late August of the last two years exempted items like computers under $3,000 and sports equipment from the 6.625% sales tax. Murphy initially introduced the tax break, but the state now expects to save $35 million by discontinuing it.
“As an educator with three school-age children, the ending of the sales tax holiday is going to be felt immensely for not only my students’ families, but for myself as I prepare my classroom with items that do not necessarily fall within the scope of our budget,” said Camden County Technical Schools instructor Tonia Respes.
“With all that we have to send our own children back to school with, that holiday is going to be missed,” she added. “As expensive as it is to live in New Jersey, the … tax-free back-to-school supplies are but a small perk. The decision feels insensitive and a bit greedy.”
The decision to revoke the tax break comes as back-to-school spending is projected to reach nearly $39 billion nationwide, with families expected to spend an average of about $874 on related purchases. Outside of New Jersey, 19 other states will keep some form of the sales tax holiday this year.
The effectiveness of the tax holidays remains controversial. While popular among consumers and politicians, some experts argue that the government revenue lost could be better used for targeted assistance programs that directly benefit lower-income families.
“Sales tax holidays are politically popular because they offer visible discounts to consumers,” noted the Tax Foundation – a Washington, D.C.-based organization that offers ideas on tax policy worldwide – in a recent report. “However, they are economically inefficient and often don’t meet their stated objectives.”
But the holidays remain popular in the community.
“I recently learned about these changes, and I just don’t understand the reasoning behind them,” argued Voorhees parent Marilyn Echevarria. “Everything is already so expensive, from uniforms to school supplies, and now they’re taking even more from us. New Jersey is already one of the states with high taxes.
“What’s next?”
