New Jerseyans buying pens, notebooks, computers, and other school supplies will get a 10-day tax break starting Saturday when a sales tax holiday begins for the second straight year.
First enacted last year in what state officials said was a bid to combat sharp inflation, the sales tax reprieve will waive the state’s 6.625% sales tax for a host of school materials, including art supplies and sports equipment, between Aug. 26 and Sept. 4.
“Back-to-school excitement can easily turn to stress for both parents and teachers, particularly those who are struggling to make ends meet,” Gov. Phil Murphy said in a statement. “We’re committed to making New Jersey more affordable in ways both big and small.”
Tax policy experts have questioned the utility of sales tax holidays, noting that low-income residents who likely need the aid have less ability to time their purchases. And because the tax holiday is planned far in advance, retailers can temporarily hike prices, as they often do around large sales like Black Friday.
The programs also carry administrative burdens for tax officials and businesses, which must adjust tax collections for a subset of their inventory and then reverse the work days later.
The state maintains a list of items that won’t come with sales tax for the 10-day period. It includes printers, hard drives, and other computer accessories worth no more than $1,000 and computers that cost up to $3,000 as long as they are not purchased for business use.
The sales tax break applies to purchases made in brick-and-mortar New Jersey stores and with online outlets, regardless of where they are based.
Expectations for residents’ savings have come down since the tax holiday’s first year, when it cost the state roughly $32.3 million in foregone sales tax revenue. Treasury officials expected the program would cost the state $70 million.
This year, they expect the state will forego roughly $32.7 million in revenue because of the holiday.
“We made the commitment last year to help ease that burden with the sales tax holiday. Now in its second consecutive year, parents, students, and teachers can feel secure about the extra savings on school items, from kindergarten to graduate school,” Assembly Speaker Craig Coughlin (D-Middlesex) said in a statement.
Items exempt from sales tax from Aug. 26 – Sept. 4:
- Computers less than $3,000.
- Computer equipment less than $1,000, like printers, printer supplies, and storage media.
- Instructional materials, like reference books, maps, textbooks, and workbooks.
- School supplies, like binders, book bags, chalk, crayons, calculators, compasses, pens, pencils, erasers, and notebooks.
- Sports or recreational equipment, like shin guards, shoulder pads, gloves, wetsuits, helmets, and ballet and tap shoes.
- Art supplies, like clay and glazes, paintbrushes, paints, watercolors, and drawing pads.
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