Shoppers line up for tax-free sales

State's weak economy endangers holiday By HARRIET VAUGHAN • Staff Writer • August 2, 2008 Shopper Michelle Crouthamel has a one-track mind: load the kids and shopping bags in the car and hit the next store to finish out her tax-free weekend shopping before the big crowds come out. This run-and-gun style of shopping is common for thousands of well-rehearsed shopperstaking advantage of Tennessee's third August holiday, whichallows shoppers to skip the sales tax on most clothing, school supplies, computers and other back-to-school necessities. "It's fabulous," Crouthamel said. While shoppers save millions of dollars during the August tax-free weekend, the state economy takes an $8 million-$10 million hit. The state takes the brunt of sales tax exemptions, since local governments are reimbursed for all losses accrued during the tax-free break. August is the more successful of the state's twotax-free holiday weekends; the othertax-exempt weekend is in April. The financial hit wasn't a problem until this fiscal year, when Tennessee's economy has taken a turn for the worse. "Tennessee is not unique in the slowing of the national economy, and there is a decline in the amount of sales tax, franchise and excise tax being collected," said Sophie Moery, spokeswoman for the Tennessee Department of Revenue. As a result of the tight economy, legislators did not approve an April 2009 tax-free weekend. Unlike the August shopping holiday, which was mandated to occur every August in time for back-to-school, the April holiday must be approved by legislators the year before. Now, the outlook for the August tax break is also uncertain. Gov. Phil Bredesen, who introduced the law in 2005, recently expressed reservations over the sales tax holiday. Amid a scurry to trim 2,300 employees from the state's payroll, every dollar coming into the state helps. Bredesen told reporters last week that if he had the ability to call it off to save jobs, he would. To make that happen, the Legislature would have to pass a law reversing the August tax-free weekend. The uncertainty of the sales-tax holiday is bad news for teacher Annette Campbell, who has 19 years of teaching under her belt. "It needs to stay. Whatever measures need to be taken to ensure that the holiday stays need to happen," she said. "Once a year is wonderful, but if we can keep it as often as we can, then that's a blessing." Like other Metro teachers, Campbell, a special education teacher at Whites Creek High, receives $200 to spend on classroom and teaching supplies. Each year she spends an additional $300 out of pocket, an act common to teachers. Campbell and a fellow teacher buy additional school supplies, books and uniforms for students whose parents can't afford their basic school essentials. She and other teachers at Whites Creek take advantage of both shopping holidays to help stagger their spending. "Any time that we as teachers and parents have an opportunity to save money to help educate our children, we do it," said Campbell. News of the canceled spring tax-free weekend is hitting Tennessee Target stores hard. Store manager Jason Gordon says the August tax-free weekend is the store's biggest shopping time next to Christmas. Managers at the Charlotte Pike location doubled their staff and spent additional hours preparing the store for shoppers. "We see an increase in sales compared to any normal weekend," said Gordon