Sales Tax-Free Shopping Initiative Starts Sunday

WEST OCEAN CITY – Against the back-drop of the Ocean City Factory Outlets in West Ocean City, state and local officials were on hand on Monday to announce a week-long break from the 6-percent sales tax in Maryland starting Sunday.

Maryland Comptroller Peter Franchot, along with state and local elected officials, on Monday announced Shop Maryland, a week-long campaign to promote retail sales by forgiving the 6-percent sales tax on most clothing and shoe purchases. The tax-free week begins this Sunday and runs through next Saturday, Aug. 14.

“The message today is everybody needs to shop in Maryland,” said Franchot. “We need to encourage people to take advantage of this. It’s good for their pockets and it will help stimulate the local economy.”

Franchot said the concept is to offer consumers a break from sales tax, which will in turn stimulate retail sales in Maryland.

“We’ve heard a lot about the stimulus and we’re thankful for that, but the only thing that is going to pull us out of this economy is a strong, viable small business and private sector. That’s the genius of our system,” he said.

The year’s tax-free shopping event will last an entire week for the first time since the concept was launched in 2001. The last time the state offered tax-free shopping in 2006, the event covered only five days. Franchot said he expects consumers to take full advantage of the savings.

“We anticipate a 10-percent increase in retail sales,” he said. “We’re going to take a small hit on the state sales tax revenue for a week, but I really like the whole concept of ‘Shop Maryland’. It will really boost sales for retailers and small business.”

Maryland Retailers Association President Patrick Donoho said the idea behind the tax-free shopping days, particularly its timing with the traditional back-to-school shopping season, is to provide a shot in the arm for small businesses in Maryland. He also said the event will put retailers in Maryland on a level playing field with neighboring states with no sales tax.

“I think this will jumpstart sales in Maryland,” he said. “This allows our members to compete with our neighbors and I hope consumers take advantage of it.

Donoho also pointed out the importance of the retail sector on the employment rolls in Maryland. He said 20 percent of all employment in Maryland is vested in the retail sector.

“Retail is the biggest employment sector in Maryland and this means jobs, jobs, jobs,” he said. “Hopefully, this will set the stage for a very strong fall and strong Christmas shopping season.”

Ocean City Mayor Rick Meehan agreed the week of tax-free shopping in Maryland would provide a shot in the arm for the resort area’s retail businesses and praised the timing of the event.

“To have this week of tax-free savings will be a great advantage for our retailers, many of whom are already offering great summer savings and end of season specials,” he said. “Retail is such an important part of our local economy.”

Delegate James Mathias, who was part of the delegation to get the tax-free shopping legislation passed this year, also praised the event, borrowing part of one of his favorite sayings.

“When we take out our wallets next week, it really will be a beautiful day in Ocean City,” he said. “We’ve been up against some tough economic times, but we didn’t run and hide. We looked it straight in the eye.”

County Commissioner Linda Busick also had high praise for the tax-free shopping initiative.

“These are some very challenging times and this gives us a shot in the arm for our small businesses,” she said. “This is great for our local people and the tourists visiting our area. It’s good for Worcester County and it’s good for the state.”

County Commissioner Louise Gulyas offered a piece of advice for wives and mothers to take advantage of the savings.

“Ladies, get out those cards and charge, charge, charge,” she said. “This is going to be a great time to shop in Maryland.”

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