Shoppers, retailers prepare for tax-free holiday, tax group says holiday unhelpful

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KANSAS CITY, Mo. -- Shoppers will be saving some money during Missouri’s tax-free weekend. It kicks off just after midnight on Friday and runs through Sunday. Certain back-to-school purchases will be exempt from state sales tax.

But city and county tax breaks depend on whether the area wants to take part. You'll save on items like school supplies, clothing -- even computers. There are specific rules about purchase limits. For example, school supplies cannot cost more than $50 per purchase.

Computers have a limit of $3,500 dollars to make them tax-free. A Washington D.C. think tank says the upcoming tax free weekend will not be a boon for consumers or area merchants.

Some people FOX 4 talked to could not disagree more.

Ohio-natives Monica Koulter and her daughter are visiting relatives in Missouri. High on their to-do list, or there must-do list, is to go shopping and take advantage of the Show-Me-State's tax-free holiday weekend.

"I have four children so you know when you go back to school shopping you save a lot of money," Koulter said.

According to a new study by the non-partisan group, "Tax Foundation," in Washington D.C. the tax holidays do not benefit consumers, retailers or local economies.

“They don't actually boost spending or increase output of the economy." Liz Malm from the Tax Foundation, said.

The group said in the long-run, temporary rollbacks of sales taxes will hurt shoppers and retailers' pockets.

"There's been some evidence that retailers might actually up their prices on these days, so they may not be saving the money that that they think," Malm said

She also said in 1980 that Ohio and Michigan were the first states to embrace an annual, tax-free weekend. In 2004, Missouri started doing it. Interestingly, in 2013, North Carolina repealed its sales tax holiday, telling shoppers that 2013 will be the last year they can cash in on the apparent, three-day bargain weekend.

But local retailers are undaunted. At a Target in Liberty, tax-free signs are on the front doors, as the store prepares for a huge boon in business.

“We're counting down to it," Kolby Rosengreen, manager, said. It’s a great, three-day event for us. It's comparable to the traffic of our holiday weekend, Black Friday, that sort of thing."

Like it or not, Missouri and 16 other states will participate in the tax-free holiday weekend bright and early on Friday.

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