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New Yorkers are expected to head to their favorite shops and malls in droves starting Tuesday as the state celebrates its fourth "sales tax holiday."

During the tax-exempt period, which runs from Tuesday through Monday, consumers will not have to pay the state's 4 percent sales tax on most clothing items and footwear priced at less than $500.

Not only will shoppers benefit from the absence of the state's sales tax, they'll also avoid local sales taxes in nearly every taxing jurisdiction across the state. In Erie County that means another 4 percent price break, while shoppers will save 3 percent in Niagara County.

Only Orange County and the City of White Plains will continue to charge local sales tax during the one-week exemption period.

The tax-free period is designed as a retail boosting tool that will, at least temporarily, level the playing field between New York and bordering states, such as Pennsylvania and New Jersey, which don't charge sales tax on apparel and footwear purchases.

"Our members are really excited about the week ahead," said Ted Potrikus, executive director of the Retail Council of New York State. "We worked very hard for this during the last legislative session, it was our top priority."

The sales tax exemption not only applies to items purchased in retail settings, but also those made via catalogs and the Internet.

Even layaway purchases are sales tax free, as long as the buyer puts down a minimum of 10 percent of the price at the time of the transaction.

As with the prior sales tax holidays, not all wearable items can be bought without sales tax. The prime exceptions are costumes, sports protective gear, hair accessories, jewelry and sewing materials.

More than a few retailers are using the sales tax free week as a hook for even bigger savings. For example: Burlington Coat Factory, which has just opened a new Buffalo-area store, started the sales tax holiday several days early by marking down merchandise 8 percent. The retailer is also offering a discount equal to the tax break on clothing priced over the state's $500 limit.

Non-apparel retailers are also jumping on the "no tax" bandwagon, selling everything from bedroom sets to paint to used cars at discounts mirroring the sales tax. Locally, Rosa's Furniture and Appliances, the Raymour & Flanigan furniture chain and Factory Warehouse Sales are using the sales tax holiday as a promotional tool for their non-exempt merchandise.

Despite the fact New Yorkers have been through "no sales tax" weeks three times in the past 18 months, they are expected to embrace the tax-free shopping opportunity with as much, or even more vigor than in prior trials.

This September's rendition includes a "hat trick" of components consumers want, according to Potrikus.

"Not only does this version include footwear and a $500 per item limit, the timing is also perfect, right at the peak of the back-to-school shopping period."

The back-to-school shopping period -- which stretches from July through October, peaking in the last week of August and first week of September -- is considered the second-busiest apparel buying season of the year, second only to Christmas in dollar amounts and volume of merchandise purchased.

An October 1997 poll of New Yorkers conducted by Zogby International in the wake of last September's tax-free week found that one in five state residents bought more clothing than they normally would have. Last September, the positioning of Labor Day may have dampened the impact of the sales tax holiday.

The Sept. 1 holiday put the start of the no sales tax week on the day before the first day of school in the majority of districts, forcing many parents to do most of their shopping in advance of the exemption. But this year, with Labor Day falling on Sept. 7 and most schools opening later that week, Sept. 1 through 7 should be prime time for school shopping.

Betsey Bonvissuto, Boulevard Mall marketing director, is expecting big crowds.

"We see the sales tax holiday as a major factor in the decision about when to shop. Our retailers have had strong sales, but we think there's pent up interest to shop during the tax free week."

At the Walden Galleria, the mall will open at 9 a.m. instead of 10 a.m. on Labor Day to accommodate any last-minute shoppers who want to take advantage of the final day of the exemption period.

And New Yorkers can look forward to yet another sales tax holiday with a $500 limit in late January, with most local governments, including Erie and Niagara counties, expected to participate.

But later in the year, state consumers are in for a dramatic change. On Dec. 1, 1999, the state's portion of sales tax will be permanently repealed on purchases of apparel and footwear items costing less than $110.

At this point it is unclear whether counties and other local taxing bodies will go along with a permanent loss of what is a very lucrative revenue source. For example: Erie County stands to lose $17.9 million annually if it joins the permanent sales tax hiatus, while Niagara County would forego $3.2 million.

The topic of the permanent sales tax elimination will be front and center among topics to be discussed when the New York State Association of Counties holds its convention in Buffalo in mid-September.

Among the speakers is Potrikus, who will explain the retail industry's point of view.

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