BOSTON — The annual sales tax-free weekend will still be held this year despite the anticipated drop in state tax revenue because of the novel coronavirus.

 

The Baker-Polito administration said the tax-free weekend will take place Aug. 29-30. This marks the second sales tax holiday held under the new law signed by Gov. Charlie Baker in 2018 that made the weekend an annual occurrence.

 

"The annual sales tax holiday is an opportunity for us to support small businesses and consumers, and this year, it's a great way to support our economy that's been impacted by COVID-19," said Baker in a statement. "This pandemic has created enormous challenges for the commonwealth's small businesses, and the sales tax-free weekend is one way that we can encourage more economic activity to help Main Street businesses and local economies."

 

The holiday exempts retail items for personal use (up to $2,500 per item) from the state's sales tax of 6.25 percent. It does not include such items telecommunications, cars and boats, utilities and gasoline, meals, alcoholic beverages or marijuana. See more information here.

 

The effectiveness of a the sales tax holiday has been debated for years. Last year, the Department of Revenue estimated state tax revenue losses of between $16.7 million and $37.7 million. However, the holiday is very popular with citizens and small businesses — so popular that some Pittsfield businesses held their own "tax free" promotion in 2016 when the state didn't. 

 

After two years with no tax-free holiday because of the state's financial condition, it was made a permanent holiday by law in 2018.