Deals make tax holiday even sweeter

Anxious N.C. appliance retailers are hoping the state's first sales tax holiday on Energy Star appliances this weekend gives them a much-needed boost.

But they aren't taking any chances.

Many are rolling out additional promotions and discounts on top of the tax savings to try to entice skittish shoppers to buy.

“We're hoping it's going to be a big success,” said Don Sharpe, manager of the Plaza Appliance Mart on Monroe Road in Charlotte. The Charlotte chain, which has five locations, is discounting all of its floor models 20 percent in conjunction with the tax holiday.

North Carolina's 43 Home Depot stores will offer 10 percent off any appliance of $299 or more, which includes Energy Star appliances.

Lowes Home Improvement will also have additional discounts, said spokeswoman Karen Cobb, though she declined to offer specifics before the release of the chain's advertisements later this week.

The tax holiday works much like the school supplies sales tax holiday the state holds each August, except that this time, it's Energy Star-rated appliances that are exempt from the tax, which is 7.25 percent in Mecklenburg and slightly less elsewhere.

So on a $500 appliance, you would save $36.25 in tax in Mecklenburg County. But with some appliances costing much more than that, the savings could really add up.

The state's three-day sales tax holiday was created during a 2008 session of the General Assembly to encourage the use of more energy-efficient products.

North Carolina joins states including Texas, Georgia and Virginia in offering such a holiday. Cobb said they have been “wildly popular” in other states. South Carolina is slated to begin a month-long Energy Star tax holiday in October 2009, though that hinges on whether state revenue growth forecasts hit certain levels.

Still, despite the increasing cost of energy, North Carolina's first Energy Star sales tax holiday has not generated a lot of buzz.

At the Monroe Road Plaza location, about a dozen customers in the past two weeks have inquired about the tax-free weekend, Sharpe said.

Now, he said, retailers are hoping others will hear about it in the media this week. “That's how it gets out,” he said.

The slump in home building, commercial construction and home improvement has slowed appliance sales. In the face of decreased business, some manufacturers such as Whirlpool have been laying off workers.

The tax holiday provides an opportunity to draw shoppers to stores and encourage buying, retailers said.

“Everyone's down, no matter where you go,” Sharpe said. “But the key is, people are still buying. And that's one of the reasons we're doing this sale.”

The Energy Star program was first introduced in 1992. Since then, consumers have purchased more than 2.5 billion Energy Star products. Annual sales have grown from just over half a million in 2000 to nearly 3 million in 2007.