Copyright © 2021 Albuquerque Journal
As students prepare to get back into the classroom, New Mexico’s annual tax holiday may draw shoppers back into local stores.
New Mexico’s Back-to-School Gross Receipts Tax Holiday starts at 12:01 a.m. Friday and will continue through midnight on Sunday, according to Taxation and Revenue spokesman Charlie Moore.
The holiday allows merchants to deduct gross receipts taxes on certain retail goods, which means savings for shoppers stocking up on back-to-school supplies. However, some stores that could participate may choose not to do so, because retailers must “opt in” to the holiday.
In Albuquerque, that translates to about $8 in savings for every $100 spent on qualifying items.
For stores such as Organ Mountain Outfitters in Nob Hill, this weekend is expected to be busier than normal.
Store manager Simeon Beardsley said that this is the first year the Albuquerque location is participating but that the weekend has been a big driver of traffic for the Las Cruces location.
“In Las Cruces, it’s always been a really big weekend, with a lot of turnout,” Beardsley said.
To prepare, Beardsley said the store is stocking up on popular items such as T-shirts.
According to the National Retail Federation, this year will mark a record amount spent on back-to-school shopping, with the average family of elementary school children spending $848.90 on school items.
College students and their families are expected to pay an average of $1,200.32 on school supplies, including dorm equipment.
Not all items will be eligible to be sold tax-free – the holiday is limited to clothing and shoes priced at less than $100 each, computers priced at less than $1,000 and related computer hardware priced at less than $500, and school supplies priced at less than $30 each.
While stores may only deduct GRT from specific items, Moore said that some stores may choose to take the tax off other items as well. Moore said that the Taxation and Revenue Department estimates that shoppers save about $4 million annually during the tax holiday.
“The annual back-to-school tax holiday is a great opportunity for families to get ready for the coming school year and save a little money in the process,” Taxation and Revenue Secretary Stephanie Schardin Clarke said in a statement announcing the holiday.