Arbeitspapier
Spending responses to state sales tax holidays
Every year over 20 states offer sales tax holidays (STHs) on specific items like clothes, shoes and other items to encourage consumption, effecting over 100 million consumers. We use a unique dataset of credit cards transaction to study the spending response to these holidays. Using a diff-in-diff methodology, we find that STHs increase overall daily spending by 8%, with large percentage increases in spending on children's clothes and shoes of 193% and 98% respectively. Consumers with children increase spending more during STHs. Our estimates of price elasticities range from 6 for big box merchants to 30 for kids clothing merchants (in absolute terms). There is no evidence of inter-temporal substitution either before or after the STH or cross-product substitution away from non-treated goods. Finally, we show that consumers from across state borders also take advantage of these tax holidays and shop in states offering holidays. Our falsification tests rule out concerns that our results are driven by spurious correlations.
- Sprache
-
Englisch
- Erschienen in
-
Series: Working Paper ; No. 2012-10
- Klassifikation
-
Wirtschaft
Consumer Economics: Empirical Analysis
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Taxation, Subsidies, and Revenue: General
State and Local Taxation, Subsidies, and Revenue
Retail and Wholesale Trade; e-Commerce
- Thema
-
Consumption
State Sales Tax Holidays
Back to School
Credit Cards
Household Finance
Banks
Loans
Shopping
Spending
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Agarwal, Sumit
McGranahan, Leslie
- Ereignis
-
Veröffentlichung
- (wer)
-
Federal Reserve Bank of Chicago
- (wo)
-
Chicago, IL
- (wann)
-
2012
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Agarwal, Sumit
- McGranahan, Leslie
- Federal Reserve Bank of Chicago
Entstanden
- 2012
Ähnliche Objekte (12)
The effect of sales tax holidays on household consumption patterns
Tax Holidays in a Business Climate
Multinationals, tax holidays, and technology transfer
SALES TAX RETURN
Capital Tax Competition with Inefficient Government Spending
Structural tax reforms and public spending efficiency
Output response to government spending: Evidence from new international military spending data
Household spending out of a tax rebate: Italian "€80 tax bonus"
A federal sales tax
Tax, private school fees and state school spending
Local Property Tax Reform and Municipality Spending Efficiency
The impact of tax knowledge and budget spending influence on tax compliance
The effect of sales tax holidays on household consumption patterns
Tax Holidays in a Business Climate
Multinationals, tax holidays, and technology transfer
SALES TAX RETURN
Capital Tax Competition with Inefficient Government Spending
Structural tax reforms and public spending efficiency
Output response to government spending: Evidence from new international military spending data
Household spending out of a tax rebate: Italian "€80 tax bonus"
A federal sales tax
Tax, private school fees and state school spending
Local Property Tax Reform and Municipality Spending Efficiency
The impact of tax knowledge and budget spending influence on tax compliance
The effect of sales tax holidays on household consumption patterns
Tax Holidays in a Business Climate
Multinationals, tax holidays, and technology transfer
SALES TAX RETURN
Capital Tax Competition with Inefficient Government Spending
Structural tax reforms and public spending efficiency
Output response to government spending: Evidence from new international military spending data
Household spending out of a tax rebate: Italian "€80 tax bonus"
A federal sales tax
Tax, private school fees and state school spending
Local Property Tax Reform and Municipality Spending Efficiency