When Illinois Governor Pat Quinn signed legislation in July, suspending the state’s 5% sales tax for ten days beginning Friday, August 6, he was hoping for an avalanche of positive responses from the state’s retailers and most importantly shoppers. “President Kennedy said a rising tide lifts all boats” said Gov. Quinn at the signing ceremony.

“He didn’t say all yachts. That’s what the sales tax holiday is all about. It’s for that person who lives paycheck to paycheck and needs to save $10 or $15…”

Critics however point to current state debt, and say that the state can ill afford the first-ever tax holiday. Illinois’ tax holiday comes as the state ended fiscal 2010 in “the worst fiscal position in its history” according to State Comptroller Dan Hynes in the most recent quarterly report. Illinois’ backlog of unpaid bills and fund transfers rose to $4.7 billion from $2.8 billion a year earlier. Some estimate the state could lose $60 million in revenue as a result.

David F. Vite, Illinois Retail Merchants Association President & CEO, was also present at the ceremony and said “Both consumers and businesses have been crying out for relief during this difficult economic downturn.” Vite continued, “The road to recovery goes through retailing and consumers, and Illinois’ first-ever sales tax holiday will go a long way in aiding these efforts.”

Reaction from parents though, has been surprisingly mixed.

Bianca Crusoe, whose daughters attend Laraway elementary in Joliet, says “I’m really glad that they suspended the sales tax. I think it will encourage people to get out more and spend more money. With the economy the way it is now, it’s really helpful.”

Other parents plan to take advantage of the savings, but are less excited. “We MAY purchase school supplies then if it is convenient for us that week.” Says Debbie Buonincontro, a mother of 5 from Westmont. Buonincontro continues, “While we will try a little harder to get to the store that week, the savings is not enough to break your neck over.”

While retailers are gearing up for their usual influx of back-to-school shoppers, few at this point are planning specific campaigns to coincide with the tax holiday. Nina Ruzzano, Assistant Manager at Dollar Tree in the Hill Crest Shopping Center in Crest Hill, says that she only just heard about the tax holiday from her corporate office. When asked about any specific sales or advertising instructions, “No, we haven’t heard anything yet”, said Ruzzano. The Times Weekly asked Ruzzano for her opinion on what the overall impact might be. She said, “We already get a lot of people who come in here for back-to-school stuff, so as long as we’re fully stocked, I assume it will bring even more people.”

But will the tax holiday drive additional sales? Buonincontro doesn’t think so. “The savings will just go towards whatever the family needs, but won't be enough to buy anything we weren't going to buy anyway”, she said.

Steven Szymanski is from the western suburbs and agrees, “These items would be purchased at this time of year anyhow, so the net effect will not be noticed by anybody. The big ‘surprise’ will be how bad sales are after the sales tax holiday”.

Gov. Quinn disagrees with pessimistic views such as these, “I think this is a landmark day for our state. It’s going to help parents and families all across Illinois save money”.

Please note, local governments are not participating in the sales tax holiday, so your tax, while reduced by 5%, will vary based on the town you shop in and what, if any, local sales tax is charged. The sales tax holiday will cover school supplies and clothing under $100 per item, and does not include computers or computer supplies, textbooks and art supplies.