Tax Analysts Blog

Apple and Wal-Mart Are Perfect Together in a World of Bad Tax Policy

Posted on Jan 15, 2014

It’s kind of funny to see Apple and Wal-Mart in bed together. Two companies could not be more different. Apple represents the young, hip, educated, and cool. Everybody loves an iPhone. Wal-Mart is ridiculed by the very people who make Apple successful. It is a place at which urban sophisticates want neither to work nor to shop. And they would prefer that you didn't work or shop there either. In any event, the purveyors of tomorrow’s technology and cheap toiletries recently got together to lobby for a sales tax holiday in Wisconsin. In that regard at least, Apple and Wal-Mart are very much alike. They favor bad tax policy when it helps their bottom line. And the sales tax holiday will make purchases at Apple stores and Wal-Marts around the state tax free. Macy's lobbied as well. I don't know what other companies weighed in.

Sales tax holidays are dumb. They do not increase economic activity. They shift the timing of purchases. If you are going to buy an Apple computer, you won't buy two because of the holiday. You will just buy it during the holiday. The state loses a little money. The consumers break even if they are lucky enough that the stores didn't raise their prices. And the retailers receive a windfall. Bad policy.

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