BY JOHN REITMEYER
NJ Spotlight
From Florida to Illinois to New Mexico, families preparing for another school year are getting a break from state sales taxes as they shop for increasingly costly supplies.
In New Jersey, though, an effort to revive a back-to-school sales tax holiday that was last offered statewide in 2023 remains stalled in the Legislature.
The status of a sales-tax holiday proposal put forward last year by Gov. Mikie Sherrill is also unknown. This year, a typical basket of school supplies will cost families nearly 8% more than last year, according to an analysis by The Century Foundation and Groundwork Collaborative.
The year-over-year cost increase is more than double the rate of annual inflation tracked by the federal government earlier this summer.
Among the items costing more this year are notebooks, up 23%; scissors, up 14%; and No. 2 pencils, up 6.1%, according to the analysis.
20 states
In all, the families of children attending elementary school through high school are budgeting nearly $864 to cover school supplies this year, according to data collected by the National Retail Federation.
That’s up slightly from last year, when K-12 families budgeted $858 , according to the Washington, D.C.-based organization’s data.
The back-to-school budget for college students and their families has risen to a record $1,437.79, up from last year’s nearly $1,326 total.
“Affordability is a concern for families and a top priority for retailers as we enter the back-to-school season,” said Mark Mathews, the National Retail Federation’s chief economist and executive director of research.
A total of 20 states enacted tax policies that exempt select goods and services, including school supplies, from their sales taxes, according to a report published last month by the Tax Foundation, a Washington, D.C.-based organization that closely tracks tax policy.
A number of these states exempt clothing purchases during the tax holidays, while New Jersey does so on a permanent basis, year-round.
Despite tax holidays’ popularity, the report’s authors suggest there is some debate about their effectiveness.
“Proponents of sales tax holidays claim they create economic growth by increasing retail activity within their timeframes,” the report said. “However, studies show that much of the increased shopping during holidays is shopping that consumers would have done at other times but moved to the holiday timeframe to take advantage of discounts.”
Inflation fighter
When it debuted in 2022, New Jersey’s back-to-school sales-tax holiday was billed as a response to significant stimulus-driven inflation that followed the COVID-19 pandemic.
The sales-tax holiday spanned 10 days from late August into early September, in both 2022 and 2023.
In addition to permanent sales-tax exemptions for clothing and footwear that are written into state law, a wide range of additional items purchased both in-store and online were exempted temporarily from the state’s 6.625% sales tax.
These items included traditional school supplies, including pens, pencils and notebooks, as well as art supplies, such as paint and paintbrushes. Also exempt were computers that cost less than $3,000, as well as sports and recreation equipment such as helmets, shoulder pads, shin guards and mouth guards, among other items.
The tax break was scrapped in 2024 by then-Gov. Phil Murphy, saving state government an estimated $35 million, according to a Department of the Treasury estimate.
Legislation seeking to reinstate New Jersey’s 10-day sales tax holiday was introduced in January by Sen. Carmen Amato (R-Ocean). Assemblymen Brian Rumpf and Gregory Myhre (both R-Ocean) are cosponsoring an identical version of the bill in the lower chamber.
Meanwhile, another measure, which has bipartisan backing, calls for the establishment of a longer sales tax holiday in New Jersey throughout August and September.
“While the tax holiday is intended to provide financial relief to the students of New Jersey and their families, the general public may also make tax-free purchases for other nonbusiness uses during this time period,” according to that bill.
These and several other related bills have not been put up for votes in New Jersey’s Democratic-controlled Legislature, which is taking a lengthy, informal summer break.
Campaign pledge
Sherrill, a first-term Democrat, also promised tax relief to parents shopping for school supplies in an affordability agenda she regularly touted during last year’s campaign.
One of the individual proposals listed in her 2025 affordability agenda was a pledge: “Redesign and reintroduce the back-to-school sales tax holiday to help parents with the cost of school supplies.”
Sherrill’s affordability agenda also called for an expansion of New Jersey’s child tax credit, and she worked with lawmakers to enact that policy change, on a temporary basis, in late June.
As a result, the maximum per-child tax benefit will total $1,250, up from $1,000, through the 2028 tax year.
The governor’s office highlighted the tax credit expansion and other recent policy achievements when asked about the status of her proposed back-to-school sales tax holiday prior to publication of this story.
“Governor Sherrill is committed to making New Jersey more affordable for families,” spokeswoman Maggie Garbarino said in a statement sent via email that did not directly answer questions about the sales tax holiday proposal.
“The Governor will continue working across state government and with the Legislature to advance meaningful affordability policies that help lower costs, put money back in families’ pockets, and make New Jersey a more affordable place to raise a family,” Garbarino said.
This story was originally published by NJ Spotlight News through the NJ News Commons.
