It's no secret the downturn in the economy has had a major impact on the hair industry in all sectors. Consumers have made major adjustments to their hair needs by exercising an array of independent options.
More consumers than ever before have greatly extended the amount of time between visits to the salon for haircuts, hairstyling and hair coloring services.
Increased taxes on hair could hurt hairstyling industry by encouraging consumers to continue to find alternative methods for getting their hair care needs met.
In many cases hair consumers are cutting their own hair at home or enlisting the assistance of friends and family members for their hair needs.
They're also coloring their own tresses, applying perms and straighteners as well as adopting more casual styling problems.
Hair industry insiders are hoping for a revival of the days when hair consumers regularly made appointments for hair cuts, trims as well as chemical and styling services.
Unfortunately, some politicians have been pushing the idea of applying taxes on hair cuts and related services.
Connecticut Governor Dannel P. Malloy proposed sales tax increases on hair cuts and related services. Would increasing sales tax on hair services motivate consumers to limit spending at salons even further?
Luckily after many weeks of negotiations, Governor Malloy announced budget cuts for her state which raised the income, corporation, inheritance, gasoline, alcohol and cigarette taxes, but did not increase sales increases on hair and related services Malloy had initially proposed.
Coupons For Hair, Nail, Spa & Related
Even better, consumers who depend upon coupons for hair, nail, spa and related services are big winners in the new sales tax increases.
Coupon-clippers are also big winners because they will not be charged sales tax on the value of the coupons.
Malloy's original plan said that the sales tax would be charged on the full value of an item, even if a coupon made it half price. If a person had a $10 coupon for a $20 item, for example, they still would have been charged sales tax on the full $20. Now, under the agreement, that will not happen.
Republicans criticized Malloy's deal with the Democrats, noting that it still raises the state income tax and hikes the sales tax to 6.35 percent on retail items, up from the current level of 6 percent.
The agreement calls for approving Malloy's plans for imposing the sales tax on shoes and clothing items under $50, non-prescription drugs, spa services, pet-grooming, automotive storage, limousine rides, airport valet parking, manicures, pedicures, and cosmetic surgery starting on July 1, 2011.The state also expects to collect $9.4 million per year from online sales through a new levy that is known as the "Amazon tax'' for the famed online retailer. In addition, the gasoline and diesel taxes would increase by 3 cents per gallon.