Friday, March 01, 2002
Sales tax hiatus won't happen soon, Finan says
The Associated Press
COLUMBUS While a special study committee has recommended the Legislature declare a sales-tax holiday, Senate President Richard Finan says we shouldn't look for one anytime soon.
Mr. Finan, R-Cincinnati, said Wednesday the Senate will not consider a brief suspension of the sales tax on selected items until the state's financial picture improves.
Before it would be considered, we would have to have more money in the pot than we have now, Mr. Finan said.
Mr. Finan said the state continues to teeter from month to month on the brink of a deficit.
State tax officials estimate a three-day suspension of the sales tax on clothing, for example, would cost the state about $15 million.
The Committee to Study a Sales Tax Holiday was created in the $1.5 billion budget-balancing bill passed late last year.
In a report on its two-month study, the panel recommended the Legislature declare a sales-tax holiday, preferably on a weekend, spurring Ohioans to buy computers or back-to-school clothing.
The Ohio Department of Taxation said it would take six months to gear up for a sales-tax holiday, four months for the department to prepare and two months for merchants to get ready.
That means it already is too late to have a back-to-school sales-tax holiday this year on clothing or school supplies.
The committee's recommendations were deliberately vague, with the 11-member panel preferring to focus on guiding principles or best practices for creating the holiday, said Chairman Gene Krebs, a Preble County commissioner and former state representative.
The budget-balancing bill issued no guidelines for the study and did not call for the panel to recommend a specific length or date for a tax holiday, which has increased sales in other states.
The committee recommended that the state examine successful models in Florida and Texas. Florida has a seven-day tax suspension on clothing, footwear and accessories priced $50 or less, and on school supplies costing $10 or less. Texas has a three-day tax holiday on footwear and clothing priced at $100 or less.
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