From the Office of State Senator Rodney Ellis

For Immediate Release
Thursday, August 2, 2001
Contact: Jeremy Warren, (512) 463-0113

Texas Gears Up for Third Sales Tax Holiday

AUSTIN// -- Texas families and merchants are gearing up for the third annual sales tax holiday, which begins at midnight tonight.

"Just in time for back to school, Texans will receive a much-needed break," said Senator Rodney Ellis. "The sales tax holiday allows families to save on those necessities their children must have before going back to the classroom. The money parents will save from the tax holiday could mean a free pair of khakis or blue jeans, a free skirt or just more money in Texans' pockets."

"This holiday means real tax relief for Texas families. Too often, when the legislature tries to cut taxes, the little guy is left out. The sales tax holiday gives everyone a break, including those Texans who need it most, when they need it most."

In 1999, Senator Ellis authored legislation creating the three day sales tax holiday each August on shoes and clothing under $100. Texans saved an estimated $70 million during the first two sales tax holidays. The Comptroller expects Texans will save nearly $40 million this year.

The sales tax holiday is part of SB 441 by Ellis, a $506 million consumer and business tax cut initiative that provides historic tax relief for Texas families and business. The legislation creates a three-day sales tax holiday each August on shoes and clothing under $100.

At 8.25 percent, Texas has one of the highest combined sales tax rates in the United States. According to the Citizens for Tax Justice, Texas has the third most regressive tax system in the nation. High sales taxes hit low income and elderly Texans the hardest, forcing our poorest citizens to pay up to six times more of their income in sales taxes than more affluent Texans. Under SB 441, Texans will be able to buy socks, shoes, jeans, shirts, skirts, sweaters and other staples tax-free.

"My goal is to try to provide Texans with more tax-free items and greater savings, but we must do it in a responsible way that does not undermine our fiscal stability."