Tax holiday

Tax holiday

A tax holiday is a temporary reduction or elimination of a tax. Governments usually create tax holidays as incentives for business investment. The taxes that are most commonly reduced by national and local governments are sales taxes. In developing countries, governments sometimes reduce or eliminate corporate taxes for the purpose of attracting Foreign Direct Investment or stimulating growth in selected industries.

Tax holiday is given in respect of particular activities, and sometimes also only in particular areas with a view to develop that area of business.

ales tax holidays in the United States

The statewide sales tax holiday was first pioneered in 1999 in Texas, and since then, the initiative has been adopted by thirteen states. It commonly takes place as a form of tax-free weekend lasting Friday through Sunday, usually during a major shopping period for necessities, such as just before school starts. During that period, sales tax is not collected on selected items, such as clothing and school supplies. The items subject to the sales tax exemption may also be restricted by price (for example, clothing up to $100), but consumers are free to buy unlimited quantity of items.

As with other sales taxes, visiting residents of non-participating states who purchase tax-free goods (holiday or not) may still have to pay "use tax" on their goods that they take home.

Five states in the U.S. (Alaska, Delaware, Montana, New Hampshire and Oregon) do not impose general sales taxes at all (but may still tax gas, cigarettes, alcohol, meals, etc). See Sales taxes in the United States for details.

See also

* Tax competition
* Tax exemption
* Sales taxes in the United States
* Gas tax holiday
* Use tax

References

External links

[http://www.taxadmin.org/fta/rate/sales_holiday.html 2008 State Sales Tax Holidays] - Federation of Tax Administrators

http://www.window.state.tx.us/taxinfo/taxpubs/tx98_490/tx98_490.html

[http://www.ador.state.al.us/salestax/SalesTaxHol.htm Alabama]

[http://www.ct.gov/drs/cwp/view.asp?a=1514&q=318566 Connecticut]

[http://otr.cfo.dc.gov/otr/cwp/view,A,1329,Q,633881,otrNav_gid,1679,otrNav,|33288|.asp District of Columbia]

[http://www.etax.dor.ga.gov/ Georgia]

[http://www.iowaccess.org/tax/educate/holiday1.html Iowa]

[http://revenue.louisiana.gov/sections/general/hottopics/salestaxholiday.aspx Louisiana]

[http://www.dor.mo.gov/tax/business/sales/taxholiday/ Missouri]

[http://www.state.nm.us/tax/pubs/FYI-203.pdf New Mexico]

[http://www.dor.state.nc.us/taxes/sales/salestax_holiday.html North Carolina]

[http://www.tax.ok.gov/upmin071007.html Oklahoma]

[http://www.sctax.org/NR/rdonlyres/A7BD0A78-36BD-4B38-A00A-2AAE332625B1/0/RR059.pdf South Carolina]

[http://tn.gov/revenue/salestaxholiday/ Tennessee]

[http://www.window.state.tx.us/taxinfo/taxpubs/tx98_490/tx98_490.html Texas]

[http://www.state.vt.us/tax Vermont] [http://www.tax.virginia.gov/site.cfm?alias=STHoliday Virginia]

[http://www.state.wv.us/taxdiv/ West Virginia]


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