Tax Rebate To Boost Retail Sales
Federal tax rebates will give retail sales a significant boost in the next two quarters, predicted TNS Retail Forward, a management consulting and market research firm focused on the retail sector.
The company expects retail sales to improve by as much as three percent in the third quarter and about 1.5 percent in the second quarter. TNS Retail Forward estimates households will spend up to $42 billion of the $105.7 billion tax rebate total at retail stores from May until the end of the year, with most of the incremental retail spending occurring in the third quarter.
Year-to-year growth for the second quarter growth is forecast at 3.5 percent with the tax rebates instead of three percent without the rebate impact. Third quarter growth is forecast at six percent instead of three percent without. The sales forecast excludes autos and gasoline as reported by the U.S. Department of Commerce.