States to Lose $1.3 Billion From Sales Tax Holidays, Report Says

Sales tax holidays in 18 states will reduce their revenue by a collective $1.3 billion in 2025, according to a recent study.

The report, issued July 17 by the Institute on Taxation and Economic Policy, shows those states are on the hook for lost sales taxes from a slew of items like school supplies, energy-efficient appliances, electrical generators, and emergency supplies.

The projected $1.3 billion revenue hit is similar to what sales tax holidays cost states last year, but now comes amid greater uncertainty over state finances stemming from a new federal tax overhaul that could further strain state ...