LIVE VIDEO: News 2 at 5 pm    Watch
 

NC Lawmakers Pass Tax Plan Overhaul, Repeal Sales-Tax Free Weekend

10:38 PM, Jul 18, 2013   |    comments
  • Share
  • Print
  • - A A A +

Greensboro, NC - You've heard the saying - "The only things certain in life are death and taxes." For the past decade in North Carolina, you could add the tax-free holiday weekend to that list.

Since 2002, shoppers have been able to buy clothing, school supplies, computers and more for two days in August without paying sales tax.

Shoppers who hit the stores on August 2 through the 4, will experience the last year of the tax free holiday weekend in North Carolina.

That's because lawmakers will ax the holiday in their new tax plan that is awaiting Governor McCrory's signature.

READ: NC Tax Overhaul Soon To Become Law

The North Carolina General Assembly gave final passage to a sweeping tax reform bill Wednesday evening. The plan lowers income tax rates, adjusts sales tax, repeals the estate tax and gets rid of the tax-free holiday weekend.

The bill will also cap the state gasoline tax, raise the per-child tax credit for low-income families, and repeal the holiday weekend for Energy Star appliances.

WFMY News 2's Morgan Hightower spoke to a financial expert about what these changes mean and a business owner who says the sales tax holiday has always been his biggest weekend for sales. 

The sales-tax free weekend is the Black Friday of back-to-school shopping. The North Carolina Retail Merchants Association says shoppers save $14.7 million dollars in sales tax. The new tax plan might change that by doing away with the popular holiday. 

"That's not good for my business."

David Leipziger is the owner of Embroidery by Custom Caps, Shorts and More. Each summer, he opens a kiosk at local malls selling only backpacks. It's a back-to-school staple and Leipzieger says he sees a lot of traffic over the tax-free weekend.

"People are waiting for that weekend to save tax money and that's when they want to come out and save the most money," said Leipziger.

Leipziger says the holiday is an incentive to bring shoppers out in masses, and losing that crowd would hurt his bottom line.

But there is another side to this. The $14.7 million dollars shoppers save is $14.7 million the state loses in tax revenue. 

"Based on projections, the overall picture is this new tax plan will hurt to the tune of half a billion dollars. They're going to have to make that up. One portion of that is doing away with this very popular tax holiday," said Michael Wittenberg, Wittenberg Priddy Blankenship, Securities Offered Through First Allied Securities, Inc. 

Wittenberg is a financial expert. He says the loss of the tax-free weekend might sting in August but that's just part of the give and take with this plan. 

"What will happen is that at the end of the year, when they file their return, they should be giving less to the state and that's going to make them happy," said Wittenberg.

The sales-tax free weekend is a great time to find deals, but it's not your only chance at saving money.

News 2 did some research and found the best time to buy computers is usually in mid-summer, September or Black Friday.

When it comes to your back-to-school wardrobe, it's smart to shop early. The best deals are over Memorial Day weekend. Sales pick up again after schools start in September.

WFMY News 2

Most Watched Videos