The state House of Representatives voted to approve a sales tax holiday next month.
This is an updated version of a story posted at 2:25 this afternoon.
Kris OConnor, left, a salesman at Manny's TV & Appliance store on Boston Road in Springfield goes over paperwork with Omer J. Picard Jr., of Ludlow, during last year's appliance rebate program. Customers are hoping there won't be a repeat of the problems Thursday that plagued the program last year, when the state's Internet connection failed to work.BOSTON - State government, newly flush with cash, is giving shoppers a couple of breaks - an appliance rebate program and an annual sales tax holiday next month.
The state House of Representatives on Wednesday voted 123-23 to approve a bill that exempts people from the 6.25 percent sales tax during the weekend of Aug. 13 and 14. The Massachusetts Senate is expected to approve the bill today. Gov. Deval L. Patrick said he will sign the measure, because the state can afford it.
Starting Thursday, consumers can also sign up for as much as $200 in state rebates for energy-saving refrigerators or air conditioners.
The sales tax holiday would be the seventh in eight years. Almost everyone expected it would be approved this year, but any doubts were dispelled last week when state tax collections for the recent fiscal year jumped $723 million more than projected and more than $2 billion over the prior year, giving the state a healthy surplus.
In a speech before the House vote, Rep. Joseph F. Wagner, a Chicopee Democrat, said the sales tax holiday "is pro-consumer, pro-business and pro retail employee."
There was some dissent. Democratic Reps. Ellen Story of Amherst, John W. Scibak of South Hadley and Stephen Kulik of Worthington were among Democrats who voted in opposition to the tax holiday.
Kulik said he was partly concerned about cuts in the state budget including reductions to state colleges and universities and human services. "I felt symbolically it was not appropriate to support a further reduction in state revenues after we made these difficult cuts," Kulik said.
Story said the state can't afford the loss of revenues, estimated at $20 million for the weekend. "It's very bad tax policy," she said. "I disagree with it as policy."
During the weekend, the sales tax will not be charged on any single item worth $2,500 or less. Certain items, including motor vehicles, motor boats, gas, cigarettes and restaurant meals, are not included in the holiday.
Ellen StoryJon B. Hurst , president of the Retailers Association of Massachusetts, said that suspension of the tax is a proven way to keep people from shopping tax-free on the Internet or traveling to New Hampshire, which has no sales tax.
"It's a very powerful incentive," Hurst said. "People view it as an opportunity to get something back from government."
Hurst said the retail industry could see some new momentum from the combination of a sales tax holiday and an appliance rebate program.
State rebates for refrigerators and air conditioners, offered on a first-come, first-serve basis, might even last until the sales tax holiday Aug. 13 and 14, according to a spokeswoman for the state Executive Office of Energy and Environmental Affairs.
Stephen Kulik"We can't predict how long the funding will last, but our contractor's experience with similarly designed programs in other states created an estimate of a couple of weeks," press secretary Catherine Williams said in an e-mail. "It is up to a customer's discretion, informed by the real-time funding status information, as to whether it's worth waiting until the tax holiday or not."
The program, open to Massachusetts households, offers $150 rebate for a Energy Star refrigerator and $50 for a room air conditioner to replace older models.
Under the program, people should check that rebate funds are available. If there are funds left, people must first buy a refrigerator or air conditioner from a registered retailer and then fill out a rebate application, either online or over the phone. A completed application puts a hold on the rebate.
Before buying an item, people can check how much rebate money is available by going online to www.MassEnergyRebates.com. A list of participating retailers can also be found at this site. From their stores, retailers can provide customers with real-time status of funding, state officials said.
People can also call a toll-free customer service center at (877) 574-1128.
The program, partly financed by a federal stimulus grant, is expected to fund approximately 20,000 rebates worth $2 million and is estimated save enough annual energy to power 250 homes for a year, state officials said.
A signed rebate application must be sent with proof of purchase to Helgeson Enterprises Inc. of Minnesota, hired by the state to administer the program. Rebate checks will be sent via the mail.