Tax 'holiday' for hurricane supplies this week

Memorial Day is likely to get Hampton Roads residents thinking more about vacations, beaches and the warm summer sun than about hurricanes.

But with Atlantic Coast hurricane season officially beginning June 1, consumers can save a bit on items they might buy to stock up for potential storms.

The second Virginia sales-tax holiday for hurricane preparedness runs today through May 31 and allows consumers to save the state's 5 percent sales tax on designated items, from portable generators to duct tape.

Like other state sales-tax holidays - in August for back-to-school shopping and in October on energy-efficient appliances - the General Assembly passed the reprieve for hurricane preparedness at the suggestion of retailers that hoped the savings would draw shoppers. Unlike the back-to-school holiday, however, the hurricane-related tax exemption last year didn't create a discernible boost in sales at many stores, according to local retailers.

"Our numbers indicated that it wasn't a big benefit for them," said Susan Milhoan, president and chief executive of Retail Alliance, the region's trade group for merchants.

Retailers such as Dollar Tree and Taylor's Do-It hardware stores promoted the hurricane tax break last year, "but I don't think they saw the bump that they wanted," Milhoan said. "I don't know that this holiday is going to change people's shopping patterns."

The state Department of Taxation has no way to track any increase in sales directly from the tax holidays, said Joel Davison, a department spokesman. The no-tax events occur just a few days during a month, and retailers submit their sales taxes monthly, with no daily breakdown, he explained.

E.R. Anderson, a spokeswoman for Wal-Mart Stores Inc., said the hurricane-related holiday also isn't as significant an event for the discount giant as the back-to-school weekend, when the stores enhance stock and staff in anticipation of crowds.

"Everybody's thinking about back-to-school at the same time," Anderson said. "People aren't necessarily thinking about hurricane preparedness now."

Officials at Home Depot, one of the retailers that pushed for the hurricane-preparedness holiday, won't discuss sales but noticed a surge in shopping activity during the week last year, said Craig Fishel, a spokesman for the chain, based in Atlanta.

"We do see increased traffic as a result of these events," he said.

The inclusion of some items on the tax-exempt list creates a challenge for certain small retailers, Milhoan said. Convenience stores and restaurants that sell individual bottles of water, for example, have to reconfigure their cash registers and complete the state's tax paperwork when those customers typically aren't making the purchase to stock up or prepare for a hurricane. Those retailers have the hassle of the holiday with no real sales benefit, Milhoan said.

During each of Virginia's sales-tax breaks, retailers have the option of discounting the tax from any of their merchandise - not just the designated items - and absorbing the 5 percent themselves, though they still must remit it to the state for those sales.

Wal-Mart did that for computers and related accessories during the back-to-school tax holiday last August but isn't offering any additional tax breaks this time beyond the designated hurricane items, Anderson said.

Carolyn Shapiro, (757) 446-2270, carolyn.shapiro@pilotonline.com