Stores await consumers’ tax rebates
Sony wants to turn your tax rebate into a high-definition television. Home Depot has other plans for your check from Uncle Sam: help the Earth by spending it on energy-efficient appliances. And Sears is offering a gift card to customers for the amount of their rebate checks, plus a 10 percent bonus.
Merchants struggling with the slowdown in spending are stepping up promotions to court consumers who are expecting a cash infusion from federal rebate checks. Retailers are already planning major sales and big advertising campaigns in the fierce fight for dollars – even though the government won’t start mailing out the checks until May. For merchants worried about a bleak year, this is like Christmas in spring.
Store owners have good reason to expect a shopping spree. People plan to spend 40.6 percent, or about $42.9 billion, of the $105.7 billion the government is distributing in tax rebates, according to a survey conducted in February by the National Retail Federation, a Washington, D.C., trade group. Consumers, besieged by soaring cost of gas and groceries and declining home values, plan to use about $30 billion to pay down debt and about $20 billion to put in savings, the survey found.
The tax rebate, part of a federal effort to boost the economy, will put $600 in the pocket of most individual filers, $1,200 for couples who file jointly, and an extra $300 per child for families. Only the wealthiest taxpayers will be excluded. The rebates are separate from tax refunds, which many filers have already received.
