Big hopes hang on back-to-school tax breaks

Merchants are hoping that this weekend consumers will do something they haven't done in a while: spend with abandon.

They're counting on this weekend's tax holiday — when state and county taxes are suspended on numerous items – and their own discounts to attract consumers hungry for bargains.

So far, it looks as if their hopes may be dashed. An annual survey conducted by the National Retail Federation showed that shoppers plan to spend 7.7 percent less than they did last year on back-to-school items. On top of that bad news, there's more competition than ever. Drugstores, dollar stores and office supply stores are making their biggest pushes ever for sales of notebooks, calculators and pens.

“It's amazing how quickly people have gotten over the need to spend $30 for the right shopping bag,” said Candace Corlett, retail analyst with WSL Strategic Retail in New York

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