From the Office of State Senator Rodney Ellis

For Immediate Release
July 30, 1999
Contact: Jeremy Warren, (512) 463-0113

Texas Gears Up for First Sales Tax Holiday
Senator Ellis, Houston Business Community Put Final Tax-Free Preparations on Display

HOUSTON// -- Senator Rodney Ellis (D-Houston) and Houston merchants put their final preparations on display today at Meyerland Plaza as efforts to raise awareness of Texas' upcoming Sales Tax Holiday begin to heat up. Following the press conference, Senator Ellis toured Meyerland Plaza and spoke with shoppers about the upcoming tax holiday.

The press conference and tour kicked off a week-long effort to raise awareness of Texas' first sales tax holiday. The effort will include public service announcements, flyers to local churches and businesses, editorials and back-to-school advertising campaigns by local businesses. More public events are planned for next week. Hosts of the event included JC Penney, Palais Royal, K-Mart, Marshall's, and Rack Room Shoes. Texas' first annual sales tax holiday will begin at midnight, Friday, August 6th and conclude at 11:59 p.m. on Sunday, August 8th.

"Just in time for back-to-school, Texans are getting a much needed break," said Ellis. "The sales tax holiday allows families with school-age children to better afford the clothing they need when school starts. 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."

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. The tax holiday is estimated to save Texans at least $70 million. Texas joins Minnesota, New Jersey, Pennsylvania, Rhode Island, Connecticut, Massachusetts, New York and Florida as states with some form of sales tax holiday.

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 (a full listing of tax-free items follows).

"The sales tax holiday means real tax relief to Texas families," said Ellis. "Too often, when the legislature starts cutting taxes, the little guy is left out. The sales tax holiday will give a break to the Texans that need it most, when they need it most. My goal is to make it bigger and better every year."

AUGUST 6-8, 1999

Legislation authored by Senator Ellis designates August 6 (beginning at midnight) through August 8 as Texas' first annual Sales Tax Holiday. Clothing and shoes up to $100 per item will be tax-free. That will save Texans $8 on every $100 they spend.

Selected list of items and their exemption status on the sales tax holiday.

Baby Clothes
Bathing Suits
Belts with attached buckles
Boots-cowboy, hiking
Bridal apparel (not rentals)
Caps/hats - baseball, fishing, golf, knitted
Choir robes
Coats and wraps
Diapers - adult and baby
Formal clothing
Gloves (generally)
Gym suits and uniforms
Hooded shirts and hooded sweatshirts
Jerseys - baseball and football
Jogging apparel, such as bras, suits and shorts
Neckwear and ties
Pants and trousers
Raincoats and ponchos
Shoes - sandals, slippers, sneakers, tennis, walking
Socks (including athletic)
Suits, slacks and jackets
Sweat suits
Swim suits and trunks
Tuxedos (not rental)
Work clothes and uniforms
Accessories (generally) - barrettes, plastic pony tail holders, wallets, watches
Baseball cleats and pants
Belt buckles (without belt)
Boots - climbing, fishing, rubber work boots, ski, waders
Buttons and zippers
Cloth and lace, knitting yarns and other fabrics
Dry cleaning services
Football pants
Golf gloves
Handbags and purses
Hard hats
Helmets - bike, baseball, football, hockey, motorcycle, sports
Ice skates
Laundering services
Leather goods - except belts and wearing apparel
Pads - football, hockey, soccer, elbow, knee, shoulder
Personal flotation devices
Rented clothing (including uniforms, formal wear, and costumes)
Roller blades and skates
Safety clothing, glasses
Shoes - bicycle (cleated), bowling, golf.

Back-to-school clothing for the typical Texas family with a school-age child:

Selected Items Cost
2 pairs of shorts -- $17.99 each
1 polo shirt -- $14.99
1 button down shirt -- $12.99
1 Light Jacket $14.99
12 pair socks -- $11.98
1 pair athletic shoes -- $21.99
3 pair blue jeans -- $19.99 each
5 tee shirts -- $12.99 each (average)
TOTAL: $237.84
TOTAL Sales Tax: $19.62
Sales Tax Under SB 441: 0

(Based on JC Penney Catalog)