Connecticut’s upcoming tax-free week from August 20 – 26 could end up costing the state $4 to 5 million in tax revenue. This comes as Governor Dannel Malloy and lawmakers are struggling to resolve a $5 billion deficit in the state’s two-year budget that was due on July 1.
But Department of Revenue Services Commissioner Kevin Sullivan says the tax-week has little effect on the state budget.
Sullivan says that the $4 to 5 million lost in sales tax was not a significant number in the greater scheme of things and would not have a big effect on Connecticut’s budget.
“The problem facing the budget is not a revenue issue anyway, it’s really a spending problem and that’s why it’s been so hard I think for the legislature to wrestle with this.”
The event is in its 17th year and allows consumers to avoid the state's 6.35 percent sales tax on certain items of clothing and footwear priced under $100.
Sullivan says the holiday falls around back-to-school season and that local retailers will often drop prices on items, saving families even more money.
State law mandates a tax-free week in August, even if there is no budget in place.
