- The Washington Times - Sunday, August 19, 2001

BALTIMORE — Dress shirts were tax-free. Ties weren't. Neither were school supplies.
Despite minor confusion, the state's first tax-free week went off without a hitch.
"Based on the reports I've gotten, it went beyond our expectations," said Tom Saquella, president of the Maryland Retail Merchants Association. "I hope it sparks retail."
The state comptroller's office is compiling sales information and will report on the success of the initiative by December. From Aug. 10-16, shoppers got a tax break on clothes under $100 per item.
Comptroller William Donald Schaefer is projecting the program will save shoppers up to $6 million in sales tax and generate $85 million to $150 million in gross sales of clothing.
That's welcome news to retailers, who say it has been a disappointing year so far.
They are hoping the federal tax rebates also are giving customers an incentive to spend a little more.
Mike Golden, spokesman for the comptroller, said he will survey 850 retailers to check the results. He said confusion over what was and was not exempt tripped up some retailers. At least 25 stores across the state erroneously charged taxes.
The tax reprieve was passed in the 2000 legislature with Mr. Schaefer's backing. The idea was to help Maryland retailers competing for back-to-school dollars with nearby Delaware and Pennsylvania — two states that do not charge sales tax.
"It puts retailers on an even playing field," Mr. Golden said. "We'd like to do it again next year."
Mr. Saquella said stores he called reported sales were up, some reporting increases of 50 to 80 percent.
Stores inside malls did the best because they were the most aggressive promoters. Business was brisk at department stores, too.
The only downside was confusion over what items qualified for the exemption.
Some people thought the reprieve only applied to children's clothes. Others were confused because neighboring Washington had a tax-free week at the same time.
Then there was the issue of the tie. It wasn't covered by the law.
"If they do it again next year, they may want to include ties and school supplies," Mr. Saquella said. "It's just a thought."


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