Contact: Colleen Roche (212) 788-2958
Curt Ritter 212-788-2971
Bernadette O'Leary 212-312-3523 (EDC)
Mayor Rudolph W. Giuliani announced today that the sales tax will be suspended on clothing and shoe purchases under $500 per article during the week of September 1 through 7, 1998 - just in time for back-to-school shopping. During a shopping stop at Moe Ginsburg's clothier in Manhattan, the Mayor was joined by Deputy Mayor Rudy Washington, Moe Ginsburg President Paul Ginsburg, New York City Economic Development Corporation President Charles Millard and Department of Finance Commissioner Fred Cerullo as they previewed the City's fourth sales tax free shopping week.
"I'm pleased today to announce that once again -- from September 1st to the 7th -- the sales tax on clothing and shoe purchases under $500 per article will be eliminated, making this a fantastic time for New Yorkers to do their back-to-school shopping," said Mayor Giuliani. "I know that New Yorkers all over the city will take advantage of this opportunity and demonstrate that the elimination of the sales tax on clothing and shoes benefits businesses, consumers, and our City's economy. Moe Ginsburg knows this because since August 1st they've been offering their clothes tax-free.
"This burdensome tax hurts low-income families the most, since they often spend a larger percentage of their income on clothes sometimes as much as 12 percent," the Mayor continued. "I am pleased that as a result of our continual efforts in Albany, we can once again offer New Yorkers this tax-free week as we look forward to December 1, 1999, when the sales tax on clothing and shoe items costing less than $110 will be eliminated once and for all."
Last September the week when the tax on clothing under $100 was eliminated proved to be a great success. The event generated an average retail sales increase of approximately 48% among stores surveyed throughout the city. This year's back-to-school tax exemption, applied to clothing and shoes under $500, is expected to save New York City families even more.
All clothing and shoe items that cost less than $500 per article will be exempt from the 8.25% sales tax. The exemption applies to most clothing worn on the body and footwear. It also applies to most fabric, thread, yarn, buttons, zippers and like items used or consumed in making or repairing sales tax-exempt clothing. Alterations to exempt clothing are likewise exempt from sales tax during the one-week period.
"The latest sales tax-free week demonstrates again Mayor Giuliani's commitment to permanently eliminating the sales tax on all clothing and shoe purchases," said Randy Levine, Deputy Mayor for Economic Development, Planning and Administration. "New York City loses an estimated $700 million a year in clothing sales to New Jersey, and a total of $3.5 billion on all purchases. Once this regressive tax is removed, it is estimated that retail sales will increase by $570 million, while the total output of New York's economy will increase by $760 million. In addition, new retail jobs are expected to increase by 6,800, while total jobs will increase by 11,000."
Most accessories, including jewelry and watches, though worn on the body, are not exempt from sales tax. Additionally, equipment, such as tool belts, helmets, and baseball gloves (sporting or otherwise) remains subject to tax. (See attachments for a more specific list of exempt and non-exempt items.)
In December 1999, the State's four percent and the Metropolitan Transit Authority's 0.25 percent sales tax on clothing and shoe purchases under $110 will be eliminated and New York City will concurrently eliminate its four percent local sales tax. As a result, New Yorkers will save 8.25% when purchasing these items.
After the back-to-school tax-free week last September, the New York City Economic Development Corporation (EDC) surveyed 63 New York City retailers with 183 locations throughout the five boroughs to determine the results of the sales tax exemption.
"The retailers we contacted experienced substantial sales increases during the week," said EDC President Charles Millard. "Mayor Giuliani succeeded in his efforts to keep money in consumers' pockets while driving the City's economy. We expect that this year's back-to-school tax-free week will also be a great success." Consumers and retailers can receive further information on the back to school tax exemption week by downloading information directly from http://www.ci.nyc.ny.us/html/dof/html/salestaxfree.