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Second Amendment Sales Tax Holiday in South Carolina:

The State reports:

Hunters and collectors can save some money on gun purchases today and Saturday as the state waives sales taxes on firearms....

State Rep. Mike Pitts, R-Greenwood, said he proposed the tax-free sales to celebrate the Second Amendment and respond to a then-pending U.S. Supreme Court decision on a Washington, D.C., handgun ban, which the court overturned....

The tax-free days also coincide with the opening of the duck and small-game hunting seasons this week, Pitts said.

"It's to bring recognition that the Second Amendment of the Constitution is every bit as important as the First Amendment," which establishes freedom of religion and speech, Pitts said. "It's very much symbolic." ...

Thanks to InstaPundit for the pointer.

cboldt (mail):
Under federal law, ammunition cannot be exempt from sales tax.

.
That's a new one on me.
11.28.2008 10:40am
David Warner:
“It’s to bring recognition that the Second Amendment of the Constitution is every bit as important as the First Amendment,”

How about a year of general Repealofest housecleaning to recognize the Tenth?
11.28.2008 11:06am
J. Aldridge:
Where is the love for the militia?

They really should stop selling Kool-Aid at NRA conventions.
11.28.2008 11:17am
Jmaie (mail):
J. Aldrisge - I didn't see anything nutty in the linked story. What are you taking issue with?
11.28.2008 12:19pm
Allan (mail):
I think he's challenging the thinking (if that's not too dignified a word for it) that equates the first and second amendments. A much better argument is the [firing of a] gun as expression, under the first.
11.28.2008 12:32pm
Jmaie (mail):
That was my guess as well, but the comment isn't well fleshed out.
11.28.2008 12:43pm
David Welker (www):
I am not a huge fan of sales tax holidays. I think they are rather burdensome from an administrative perspective.

I remember buying an expensive item from Costco in Massachusetts. I did not buy it during the sales tax holiday. Since I returned it without a receipt, at first they did not want to refund the sales tax (which I did pay) on the theory that I might have purchased the item on the sales tax holiday. It was quite a hassle convincing them that they should also refund the sales tax. I was a little annoyed that this sales tax holiday, which did not benefit me, was imposing unnecessary costs on me.

In my view, the administrative costs that sales tax holidays impose on business and consumers make this a less efficient tax cut compared to other possible tax cuts. Also, it creates rather arbitrary incentives to do your purchases on a particular day, creating artificial congestion on that day.

If you want to cut sales tax, I say cut it for every day of the year. Calculate how much revenue will be lost from your sales tax holiday and lower the sales tax by an appropriate amount.

If you want to do something that is symbolic (not really about cutting taxes), pass a resolution. Do not pass "symbolic" legislation that will increase transaction costs. On the other hand, if you really do want to cut taxes, do it in a way that is as efficient as possible and is as administratively convenient as possible to comply with.
11.28.2008 12:44pm
Elliot123 (mail):
In that case, I presume retailers oppose sales tax holidays since it imposes an administrative burden?
11.28.2008 12:48pm
David Welker (www):
Elliot123,

I think that retailers enjoy a net benefit from the sales tax holiday. So they don't oppose it. But, that doesn't mean they and everyone else in society wouldn't benefit even more from a more efficient tax cut.

Look at it this way. If a tax cut results in X dollars revenue loss to the state but only transfers to business and consumers X - A (where A represents increased administrative costs and lost time due to artificial congestion) then it seems to me there might be room to make a more efficient tax cut by minimizing the size of A.
11.28.2008 12:54pm
cboldt (mail):
There was a federal sales tax holiday from August 5-13, 2006. Articles exempted were school supplies, clothing, accessory items and shoes for $100 or less.
11.28.2008 1:03pm
ASlyJD (mail):
Retailers would prefer not to have a sales tax holiday. Yes, it gets people in the store buying things with their ~7.0% discount, but it can be a real pain if the cashier systems aren't easily changeable to a 0% sales tax. Sales clerks at some businesses end up calculating a 7% discount or flat out not use the machine at all and simply keep a paper record to be entered into the system later.

The summer before I started law school, the shoe store I worked at had a faulty computerized cash register. We got to ring up our summer clearance sales the old fashioned way -- paper receipts, using the hand calculator to sum and compute taxes, carbon imprints of credit cards, and calling into the banks to get approval for transactions. Fun.
11.28.2008 1:05pm
JB:
People are irrational. If the sales tax is normally 6%, then a sales tax holiday is equivalent to a 6% off sale. People buy more when things are on sale, and they spend more than they save.

If people were perfect economic agents, sales tax holidays would have no effect but to shift purchasing to the days they happen on. But they do increase consumption.
11.28.2008 1:05pm
Crunchy Frog:
David Welker: It should be no problem to pull up the record of your purchase, since your Costco card would have been scanned at the point of sale. One would hope their computer systems would be robust enough to handle it - this isn't Joe's Bait &Tackle we're talking about here...
11.28.2008 1:13pm
Anon21:
Warped and bizarre thinking from the honorable State Rep. Does he realize that without the First Amendment, it's possible his right to advocate for vigorous enforcement of the Second Amendment might easily be compromised? Unquestionably, total freedom of speech is the most important, basic human freedom that any society can enforce.
11.28.2008 1:23pm
JRDickens:
There was a federal sales tax holiday from August 5-13, 2006. Articles exempted were school supplies, clothing, accessory items and shoes for $100 or less.


I am unaware of a federal sales tax, It seems that every day is a Federal Tax holiday.
11.28.2008 1:26pm
smitty1e:
@David Warner:
The Tenth Amendment gets honored every time they stuff us in the collective breach (did I say that correctly?).
With less cheek, as we load-shed the wrongheaded leavings of yesteryear, there needs to be a sane transition plan.
Will some of the proposed legislation of the new administration trigger a big Tenth Amendment backlash?
11.28.2008 1:42pm
Milhouse (www):
So you don't have to have a sales tax at all, but if you do you can't exempt ammunition? Does that make sense? What if you have different rates for different kinds of things, must ammo automatically get the highest rate? Can such a law even be constitutional? On what theory?
11.28.2008 1:45pm
David Welker (www):
Crunchy Frog,

Oh, I got the refund. Eventually. But only after I got the manager involved and so on. It unnecessarily consumed my time and the time of Costco employees.
11.28.2008 1:48pm
Brett Bellmore:

Under federal law, ammunition cannot be exempt from sales tax.


Somebody call the ACLU: This is their opportunity to demonstrate that they ARE willing to defend the 2nd amendment... As they claim to understand it.

Seriously, I can see neither the rationale, nor the enumerated powers basis, for such a federal law, and a quick search didn't turn up any evidence of it existing. What's the basis of this?
11.28.2008 2:04pm
cboldt (mail):
Under federal law, ammunition cannot be exempt from sales tax.


-- Seriously, I can see neither the rationale, nor the enumerated powers basis, for such a federal law --
.
There is a Federal Excise Tax of 11% on guns and ammunition, each unaffected by state laws that relate to sales tax. [Firearms and Ammunition Excise Tax (FAET)]
.
Maybe the author of the original report just made up a statement about a federal law that forbids states from waiving their own sales tax on certain items. Wouldn't be the first time a reporter blew it.
11.28.2008 2:46pm
David M. Nieporent (www):
So you don't have to have a sales tax at all, but if you do you can't exempt ammunition? Does that make sense? What if you have different rates for different kinds of things, must ammo automatically get the highest rate? Can such a law even be constitutional? On what theory?
Does anybody have any cite for this alleged "federal law"? It sounds to me like a garbled claim that the federal excise tax on ammunition can't be waived, not that a state sales tax on ammunition can't be waived.
11.28.2008 2:48pm
Bama 1L:
Under federal law, ammunition cannot be exempt from sales tax.

No, I think the journalist made a mistake or passed one along. Maybe someone was thinking of an actual federal excise tax on firearms and ammunition (FAET). A state can set its own taxes but can't mess around with federal ones. Obviously SC can't waive FAET. Someone might have thought that was why ammunition would still be taxed. The real reason is probably that the legislature decided not to include anything but firearms in the tax holiday.

So, note that SC is exempting firearms but not any sort of accessory, apparel, etc. People getting ready for hunting season will head to outdoors stores, look at tax-free guns, and buy a bunch of other stuff that will still be taxed. Meanwhile state legislators get to brag about how constitutional and pro-gun they are.
11.28.2008 2:51pm
Joel Rosenberg (mail) (www):
Let's be accurate: it's guns and energy efficient appliances. I don't know about the legal implications, but it makes it funnier.
11.28.2008 2:52pm
Bama 1L:
In that case, everyone got something they wanted.
11.28.2008 3:05pm
BGates:
Unquestionably, total freedom of speech is the most important, basic human freedom that any society can enforce.
One, I'm questioning it, two, no society has ever had "total freedom of speech", three, self defense is a more basic right than speech because one is often separated from an audience for speech but one is never apart from one's self, four, the government isn't really "enforcing" freedoms, unless "enforce" means "guarantee no legal right to interfere with", which it doesn't.
11.28.2008 3:21pm
Behringer:
David Welker, sales tax holidays impose no "administrative burdens" on businesses or consumers. All businesses have automated sales tax systems that instantaneously calculate sales tax at the register. All a business has to do in order to comply with South Carolina's sales tax holiday is switch the South Carolina sales tax button from "on" to "off." Problem solved.

Just because you had an annoying experience with a sales tax holiday (which, to be fair, was caused solely by your forgetting your receipt at home) doesn't mean sales tax holidays impose unnecessary or inappropriate "administrative burdens" on anyone.
11.28.2008 4:10pm
ForWhatItsWorth:
"...Under federal law, ammunition cannot be exempt from sales tax...."

I believe you may be confusing state sales tax with the Pittman-Robertson Act which hunters pushed for long ago to put serious money into conservation. That is an excise tax that is at the federal level and will not be on holiday.

cboldt and bama, you are right on. Didn't know if you knew where the excise tax came from.
11.28.2008 4:12pm
jccamp (mail):
Until recently, Florida had 2 sales tax holidays per year: one was for back-to-school supplies, including "Clothing and related items with a sales price of $50 or less, books with a sales price of $50 or less, school supplies with a sales price of $10 or less..." and then a second sales tax holiday for hurricane preparedness supplies, including refreezable artificial ice, portable light sources, flashlights, lanterns, candles, fuel containers (including LPG bottles), batteries, cell phone chargers, portable radios, 2 way radios, tarps, bungee cords, storm shutters, and portable generators (among other things).

Depending upon your urban environment, firearms might reasonably fall into either category.

Florida has abandoned both this year (the omnipresent budgetary reasons).
11.28.2008 5:27pm
Bill McGonigle (www):
Statistically speaking, an 11% excise tax prevents some people from keeping and bearing arms.
11.28.2008 5:30pm
David Welker (www):
Behringer,

To be fair. I did not forget my receipt. I purposely did not save it or bring it -- you do not need your receipt to make returns to Costco. They have all your purchases in their computer system. I know this very well. I have returned items to Costco without a receipt with no problems whatsoever on multiple occasions.

There would not have been any problem whatsoever this time EXCEPT for the sales tax holiday. (And I did not even shop on that day.) Your point that sales tax holiday's impose "no administrative burdens" is clearly false.

Further, you are making the assumption that everyone uses the same system for accounting for sales tax, and that this system always makes it administratively convenient to account for different rates of sales tax on different days. In fact, different businesses use different systems.

Finally, you are ignoring completely another cost, and that is the cost of artificial congestion as people time their major purchases for a particular day when sales tax will not be charged. Not to mention the inconvenience of artificially adjusting the purchase date of such purchases to coincide with this arbitrary tax holiday.

On the whole, sales tax holidays are an inefficient way to cut sales taxes. The state loses X dollars in revenue, but taxpayers only gain X - A dollars in savings. I prefer, as much as possible, that when the state loses X dollars in revenue due to a tax cut that taxpayers gain X dollars in savings.
11.28.2008 5:44pm
road warrior99 (mail):
This guy better have his fun why he can because as soon as the liberal illuminati get in office officially he is done and so are his guns. Obama is pretty much gonna re-write our 2nd amendment, just wait and see.
11.28.2008 6:13pm
Redlands (mail):
Can't wait for California to follow the lead of S. Carolina. We hate not to be in the vanguard here so I'm sure it'll happen very soon.
11.28.2008 6:59pm
jccamp (mail):
I'm almost afraid to ask. What is that? Spam? A very clever comment from the North Korean NRA? Women looking to marry rich American guys?

Sorry. None of them left...
11.28.2008 10:48pm
Soronel Haetir (mail):
David,

The problem I have with your argument is that businesses must already account for sales that are exempt from sales tax. For instance when selling to a reseller, though I suppose MA could be so regressive as to not have that typical exemption.

I have to wonder if the Costco folks were just yanking their chain for some reason.
11.28.2008 11:29pm
crane (mail):
I work in retail, and I have to say I have no idea whether we have a convenient option to turn off sales tax on everything for a day.

We do have an option to turn off sales tax on a customer's entire purchase, but a) we'd have to remember to do that for every sale, and b) on our (windows-based) register, sales tax has a distinct tendency to turn itself back on if anything, such as adding another item, happens between turning it off and entering payment. So a sales tax holiday would slow us down substantially.

jccamp - It's spam in Chinese. I took it over to babelfish, and it's just an un-punctuated list of services people might want to buy.
11.29.2008 12:21am
Porkchop:
jccamp wrote:


I'm almost afraid to ask. What is that? Spam? A very clever comment from the North Korean NRA? Women looking to marry rich American guys?

Sorry. None of them left...


Actually, it's Chinese, not Korean. But spam, nevertheless. "Bestmishu.com" seems to target blogs. You could always click on a link . . .
11.29.2008 8:09am
SC_Resident:
@Anon21:

If you had checked, you would see that South Carolina does indeed have a similar tax-free respect for the exercise of the First Amendment.... newspapers and religious materials are exempted from state sales tax in South Carolina.
11.29.2008 9:32am
jccamp (mail):
Porkchop -

I would, but I don't want to accidentally violate the terms of service, not speaking the lingua franca, so to speak...
11.29.2008 11:09am
Elliot123 (mail):
Suppose a sales tax is increased by 1/8 cent. It happens all the time. Does anyone know what a store has to do to change its systems? A holiday would seem to simply be a change from 7% to 0%.
11.29.2008 11:55am
lyarbrou (mail):
The 10% federal tax on guns and ammunition was established by the Pittman-Robertson Wildlife Restoration Act of 1937. It has been a huge success in terms of wildlife restoration and represents a very significant part of the funding of state fish and game departments. The act has been under attack in recent years by anti-hunters and anti-gun organizations who want to use the funds for non-game conservation or other purposes.


Summary: The Pittman-Robertson Wildlife Restoration Act authorizes the Secretary of the Interior to cooperate with the States, through their respective State fish and game departments, in wildlife-restoration projects. However, per statute, no money apportioned under this chapter to any state shall be expended until the state in question assents to the provisions of this chapter and has passed laws for the conservation of wildlife, which includes a prohibition against the diversion of license fees paid by hunters for any other purpose than the administration of said state's fish and game department. The Act also provides for grants for hunter education programs and a mechanism for a multi-state conservation grant program.

From the Violence Policy Center
http://www.vpc.org/studies/leadfour.htm
# Give first priority for Pittman-Robertson funds to cleaning up and repairing lead damage to public lands�such as national parks�caused by "slob shooters" and others in the shooting sports. New federal legislation earmarks at least $7.5 million each fiscal year for hunter education and "the enhancement of construction or development of firearm shooting ranges...and the updating of safety features of firearm shooting ranges...." As this report documents, serious resources need to be devoted to cleaning up the lead pollution generated by shooting ranges. Pittman-Robertson funds should first be devoted to this task. Resources should also be dedicated to repairing the environmental damage inflicted by "slob shooters."

# Redirect a portion of Pittman-Robertson funds from the sale of handguns and handgun ammunition to paying the cost of handgun lethality and injury. Firearms cause tens of thousands of deaths and injuries every year, at a staggering cost to our public health system. In 1998 alone, 30,708 Americans died by gunfire. Since 1960, more than a million Americans have died in firearm suicides, homicides, and unintentional shootings. Nearly three times that number are treated in emergency rooms each year for nonfatal injuries. Most of this carnage is caused by handguns. The nation's health care system should have a superior claim on funds derived from the sale of handguns and ammunition. This money should be restricted to funding trauma centers, for example, rather than shooting ranges.
11.29.2008 12:11pm
therut (mail):
Those Brady Brats are never going to give up. I think Clinton tried to "steal" these funds and finally got his hands slapped.
12.1.2008 11:12pm