A friend said that a better tax cut would be a sales tax holiday of six months or more

[book_worm]

that it would be more progressive and truly could save more people money than the payroll deductions could. What do you all think?

[IGotAName]

1. It could be better than what we actually got, but it wouldn't be

better than just aiming all of the tax cuts at the middle class and below.

[Aloha Spirit]

2. sales tax goes to states which are going broke, so ... I wouldn't support it.

We have sales tax holidays once a year here, and there's always a big discussion about whether we could afford that single day of loss of tax revenue.
Also, it doesn't necessarily encourage the right kind of purchasing power.

[SheilaT]

3. Most sales taxes are state and local,

not Federal. So the state and local governments would take a huge hit. I don't think that makes a lot of sense.

This really points up the essential problem of taxes, that most people have no idea where they come from or where the money goes to.

[avaistheone1]

4. People who are out of work, and those who are desperately hanging on to their homes

aren't buying much. So I don't think a sales tax holiday would work.

Besides the states need the revenue from whatever sales taxes they are getting - most of our states are on the verge of bankruptcy themselves. I don't think most of our states are in a position where they could entertain this idea.

[Skink]

5. IF we had a Federal internet sales tax I wouldn't support the holiday.

It is time for the internet to stop competing with retailers.

[Dappleganger]

6. That's whacked.

Our state is running out of money as it is, and now with the education $$ cut out it'll be even worse.

[demokatgurrl]

7. Sales tax cuts WOULD make sense

if the states weren't in such dire straits. Fed Gov't has nothing to do with sales taxes, and can't mandate cuts by the states.

[jwirr]

8. Wouldn't that just put the states in a worse situation?

[Abq_Sarah]

12. It would be devestating for my state.

[TexasObserver]

9. silly gimmicks do not create new jobs

[Phx_Dem]

10. I don't see how that would help the economy.

Generally, tax cuts make people feel like they have a little money in their pocket, so they spend it. However, when the recession is as deep as this one, that doesn't work because people are in "do not spend" mode because they're terrified of losing their jobs and not having any money in their savings account. Tax cuts only work in economic slow-downs or mild recessions (or so I'm told, by economists).

A sales tax holiday would only help if people were spending money, and they're not. Some people aren't spending because they're unemployed and they have no money to spend. Others are simply to afraid to let go of any extra cash they have, and sales tax is the last thing they care about.

[FrenchieCat]

11. Sales tax holiday helps the rich more than the poor.

As the rich buy more....and can stock up just for the occasion of celebrating a sales tax holiday.

[OhioBlue]

13. That would be a horrible idea.

Currently I think 1% of our sales tax goes to the State which is already in fiscal hardship and 5.5% goes to the County. Our County is already making drastic cuts. If they did not have that revenue for 6 months, it would cripple them. They would not be able to provide for basic services. There would be no snow removal on Country roads, there would be no funding for foster children, no Sheriff, no County planning, the Courts would be backlogged for years and years.. there would be no money for anything. We would be put into an emergency that would be unprecedented. We couldn't even merge with a neighboring County as they would have no funding either.

[crimsonblue]

14. Your friend isn't very smart

First of all, there is no national sales tax, and it would be all but impossible for Congress to pass a bill suspended state sales tax. Considering most states are in deep budgetary holes, a sales tax holiday would push them over the cliff.

[Garbo 2004]

15. Sales taxes state & local, Feds don't have jurisdiction. & not all states have sales tax.

Where there are sales taxes, eliminating them as suggested obviously would have a deleterious impact on state & local jurisdictions and services.

Given that, what do you think?