Will the nation’s stores gain a meaningful sales boost from Uncle Sam this tax season? Shopper surveys paint a mixed picture.
For one, fewer consumers are due a refund this year, according to Fung Business Intelligence Center’s Global Retail & Technology Flash Report: Tax Return Tracker #10.
As of April 9, 13 weeks into the 2015 tax-filing season, an estimated 77.2 million refunds were issued, totaling $217.4 billion and averaging $2,815 each, reported the research arm of the multinational Fung Group, led by Deborah Weinswig, executive director and head of global retail and technology.
But the number of refunds issued dropped 2.0% from 2014, and the average refund amount is down 1.2% from last year, the firm reported.
And most of the consumers due a refund won’t be using the money to shop, according to The National Retail Federation’s Tax Returns Survey, conducted by Prosper Insights and Analytics.
Indeed, 47% of shoppers expecting a refund will put the money into savings, the highest percentage in the survey’s history; 39.1% will pay down debt; and 25.1% will use the refund for daily expenses, the survey revealed.
By contrast, 13% of shoppers surveyed said the money would go towards a vacation, and 10.5% plan to spend it on a major purchase like a television or car.
Nearly two-thirds (65.7%) of those surveyed are expecting a refund, the NRF said.
Among the consumers surveyed, young adults ages 18 to 24 emerged as a notably savings-minded bunch: 54.9% plan to put their refunds into savings and 34.4% will pay down debt.
“Americans are thinking of the future, and remaining financially secure is a big part of that,” said NRF president and CEO Matthew Shay, in a statement.
But the findings of a survey by the International Council of Shopping Centers tells a different story, indicating that retailers might enjoy somewhat of a tax-season windfall.
The ICSC’s survey found that 47% of consumers polled would spend their refunds on goods and services including apparel, electronics and convenience items.
On a granular level, 13%, 11%, 5%, and 4% of consumers surveyed will spend their refunds on home goods, appliances and home improvements; restaurants, movies, plays and concerts; apparel and footwear; and electronics, respectively.
“As the economy continues to strengthen and consumer sentiment remains positive, this influx of disposable income is a boon for retailers and shopping centers,” Jesse Tron, spokesman for the ICSC, said in a press statement. “Just as lower gas prices have positively impacted consumer spending, so too will tax refunds bolster our economy.”
One thing is certain: Retailers are angling for your tax-refund dollars. The
