Bernadette O'Leary 212-312-3523 (EDC)
APPAREL SALES SURGE DURING NEW YORK'S SECOND TAX-FREE WEEK -- NEW YORKERS ENJOY "CHRISTMAS IN SEPTEMBER" DURING BACK-TO-SCHOOL SHOPPING WEEK --
Sales Tax To Be Permanently Eliminated December 1999
Mayor Rudolph W. Giuliani today announced that New York City's second sales tax exemption week in 1997 has begun with strong sales increases. Retailers throughout New York report large crowds and busy cash registers during the first day of "tax-free" shopping. Mayor Giuliani made the announcement from Today's Man, located at Fifth Avenue and 44th Street in Manhattan.
"This surge in retail activity is proof that the elimination of the sales tax is a success," said Mayor Giuliani. "The permanent elimination of the tax will save New York City families hundreds of dollars each year, increase retail sales and add thousands of jobs to our local economy. With all of the good news we're hearing this week, it really is like Christmas in September.
"As we prepare to send our children back to school, perhaps it's an appropriate time for the Legislature to consider again what we learned with the first tax-free week in January," Mayor Giuliani continued. "We know from the success of January's effort that a permanent tax elimination on purchases less than $500 would generate even more jobs and overall retail sales. New Yorkers would benefit even more if the State Legislature would go further by eliminating the sales tax on more costly apparel purchases. With just six days left to save, I hope all New Yorkers will shop 'til they drop and take advantage of tax-free clothing purchases," concluded Mayor Giuliani.
The New York City Economic Development Corporation (EDC) surveyed New York City retailers by phone to determine the initial success of the sales tax exemption. Based on preliminary reports, retailers experienced substantial sales increases yesterday and anticipate sustained crowds and retail activity throughout the week.
Beginning yesterday and continuing through September 7, New York City shoppers will not pay sales tax on clothing purchases less than $100 per article. The promotion is the second effort of its kind to boost retail sales and encourage shoppers to spend in New York City. The first tax-free week took place January 18-24, 1997. The sales tax on clothing purchases of less than $100 will be permanently repealed on December 1, 1999.
Today's Man Chairman and CEO David Feld reported substantial sales increases for the first day of the tax-free week. "Our New York City outlets have experienced a 172 percent increase in same store sales from Labor Day 1996. We expect sales to increase as the week continues and encourage all New Yorkers to take advantage of this opportunity to shop tax-free," said Dave Feld.
Economic Development Corporation President Charles Millard said, "This one-week elimination of sales tax offers residents the opportunity to take advantage of New York City's unmatched selection while enjoying lower prices on clothes for the whole family. With the permanent tax elimination in 1999, the City also will benefit from more economic activity and more jobs."
As part of the New York State Legislature's budget, the State's four percent and the Metropolitan Transit Authority's 0.25 percent sales tax on clothing purchases under $100 will be eliminated in December 1999. Other municipalities, including New York City, will concurrently eliminate local sales tax. The result in New York City will be a savings of 8.25 percent. The elimination is expected to create 11,000 jobs and $760 million in direct and indirect spending in New York City. Another tax-free week is planned for 1998 but has not yet been scheduled.
The City's first "tax-free" week in January resulted in a 73.6 percent sales increase at apparel, shoe, and department store sales compared to the same week one year before. Non-apparel retailers also saw a 12 percent sales increase for the entire month of January 1997 over January 1996, and apparel sales increased 29 percent over January 1996. Retailers in all boroughs and stores of all sizes -- from stores with annual sales under $1 million to stores with annual sales of more than $100 million -- saw increased apparel sales during the temporary elimination of the sales tax. The January elimination covered clothing and footwear purchases of less than $500. EDC is the City's primary vehicle for economic development services. Using its real estate and financial resources, EDC helps develop businesses and create jobs throughout the five boroughs.
Testimonials from retailers participating in the sales-tax free week include:
- Daffy's - Manhattan
"Sales are strong across the board. Fastest selling items are kids clothing and ladies fall apparel. It's a good, wonderful thing. People think it's great!" - Old Navy - Brooklyn
"The lines circled around the whole store. People were polite and waited in line. We are very pleased with sales." - Rosemarie's Place - Staten Island
"They had a very good day. Customers are very pleased. People are very enthusiastic. People are buying more expensive items." - TJ Maxx - Manhattan
"Very significant sales increase compared to last year. Tremendous amount of traffic in the store. All clothes items --men's, women's, children's --were selling well. Customers were very excited about it. Many made a special trip into the city to go shopping. People are looking forward to coming back again." - OshKosh - Manhattan
"Sales were very busy for a holiday, which is usually a slow time." - Queens Center - Queens
"Extremely heavy traffic. The parking lot, the food court, and the stores were mobbed. Several stores reported that sales doubled on Monday over last year. 22 non-apparel merchants joined in the sales tax holiday." - New York Retail Council - Tim Sherrin
"Members, including large department stores and small retail stores, reported 30-40% increases on Monday." - Century 21
"Sales were up 70% from last year. Had a tremendous day. Business was unbelievable across the board. Brought in extra sales help. All apparel sold very, very well." - Modell's - Manhattan
"Same store apparel sales in New York City up 63%. Sales of specialty items (licensed team/sporting goods) were up 93 percent."
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