PENNSYLVANIA Rendell proposes tax holiday on efficient-appliance sales

The tax break is to compensate for the higher price of energy-efficient models.
HARRISBURG (AP) -- Dishwashers, refrigerators and other appliances with the federal government's "Energy Star" energy-efficiency ratings would be exempt from the 6-percent state sales tax for two weeks a year under a bill that Gov. Ed Rendell outlined Wednesday.
Rendell said that the "tax holiday" on energy-efficient appliances fits in with his agenda to reduce the cost of electricity, improve efficiency and turn to more environment-friendly sources.
The legislation was introduced Wednesday in the Senate. The Rendell administration has already built the tax break into its budget proposal for the fiscal year beginning July 1.
A likely increase
The administration expects the state would miss out on $2.6 million in sales taxes in the next fiscal year. That amount is expected to increase in the years ahead as the efficiency technologies become less expensive and word of the tax holidays spreads, Rendell said.
Energy Star appliances tend to be more expensive than less-efficient products.
"Eventually, as these technologies improve, prices will come down," Rendell said. "Right now there is a difference [in price] and that's one of the reasons we're doing this."
The purchases are not supposed to be for business purposes, according to the bill. Although the bill does not specify types of appliances that qualify, administration officials listed everything from residential light fixtures to dehumidifiers.
In the past, the state has decreed tax holidays on the sale of computers.