If you have paying attention to the news over the past several years, you have probably heard about inflation. Even if you haven’t been paying attention to the news, you have probably noticed things cost more than they used to. Inflation happens when costs for goods increase due to the supply going down, or the demand going up. Since the COVID-19 pandemic, inflation has affected the price of many goods. Among those goods are school supplies.
This year, families the National Retail Federation estimates that families could spend $890 on school supplies. This is $25 more than the same time last year. Teachers could spend as much as $700 of their own money on school supplies.
Many states are trying to help teachers and families in different ways. Seventeen states are having a “tax holiday” on school supplies. This means for a period of time, people will not have to pay sales tax when they buy school supplies. Sales tax is an extra charge that must be paid to the state government with each sale of a good or service. Tax holidays are popular because families and teachers save money as they prepare to go back to school.
However, some people do not think tax holidays help in the long run. States collect money from sales tax to use on different services. Some of this includes money they use for schools. Some people argue that it would be more helpful to keep sales tax, but use the money raised by it to provide more for schools. This year, the state of New Jersey has followed that advice. For the past three years, they have had a tax holiday on school supplies. This year, they have halted their tax holiday. However, they will increase the amount of money they spend on teacher training and school lunches by over $40 million.
What Do You Think? What school supplies do you depend on? Do you think you should pay tax on them?
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