Home Blog Tax Refund Delays Can Hurt the Sports Business
Feb 14, 2017

Sneakernomics: Tax Refund Delays Can Hurt the Sports Business

Subscribe to our blog

In 2015 Congress passed the Protecting Americans from Tax Hikes (PATH) Act. One of the main provisions of PATH was to slow down taxpayer refunds for the Earned Income Tax Credit (EITC) and/or the Additional Child Tax Credit. The slowdown was intended to give the IRS more time to investigate for fraudulent claims. It is estimated that about 28 million taxpayers filed for EITC in recent years.

The effect of this slowdown in payments means that the IRS will not be issuing EITC refunds until February 15, 2017. Taking weekends, processing time, and the Presidents’ Day holiday into account, estimates are that refunds will not begin to be received until February 27, and many may extend into March.

EITC benefits low to middle income households with children. It allows parents to claim up to $3,300 for one child and more than $6,250 for three children. The magnitude of the credits is in the tens of billions of dollars.

Since most low to middle income families are living paycheck to paycheck, this tax credit is a financial windfall. Many low to middle income families spend their tax refunds as soon as they receive it.

The timing of the refund has a profound impact on sports retail, particularly sneaker sales. In years past, processing glitches have delayed refunds and the industry suffered until the refunds hit.

We can expect a soft February for sales of athletic footwear and apparel due to this new law. While the industry will make up these sales in March, it will make trending difficult and retailers and brands anxious. Coupled with a late Easter this year, Q1 will be a challenging one for the sports industry.



Upcoming Event


SFIA Virtual Conference

Presenter: Matt Powell, Senior Industry Advisor – U.S. Sports
Presentation Title: Best Practices for Brands & Retail in the Current Environment
Date and Time: Thursday, September 24 at 1:45 - 2:30 PM (EST) 
Location: Virtual
Description: Matt Powell hosts an interactive discussion on marketplace trends and what brands and retailers can do to win post-pandemic. Matt, a well-known and often quoted expert in the sports industry, will be presenting the trends and forces shaping our industry, its response to COVID-19, and its future. Matt will assess the industry across various categories, discuss the forces impacting manufacturers, retailers and consumers, and provide his predictions for the coming year. Drawing upon NPD's sales tracking data, his 40+ years in the industry, and insights from what has been successful in other industries NPD tracks, Matt will focus on best practices and what manufacturers and retailers can do to thrive in today’s rapidly changing marketplace.

Register Now

Stay current in your industry
SUBSCRIBE

Related Content

Tagged: Sports


Sneakernomics: Second Half Predictions for U.S. Sports Retail
Sneakernomics: Second Half Predictions for U.S. Sports Retail

Matt Powell outlines his expectations for the holiday season and second half of the year.

Plot Twist: U.S. Performance Bike Sales Rise in June, Reports The NPD Group
Plot Twist: U.S. Performance Bike Sales Rise in June, Reports The NPD Group

The cycling sales trend evolved in June, with the growth stemming primarily from higher-end bikes including road, gravel, mountain, and electric bikes.

Sneakernomics: First Half 2020 Athletic Footwear and Activewear Sales Results
Sneakernomics: First Half 2020 Athletic Footwear and Activewear Sales Results

Matt Powell recaps how the sneaker and active apparel markets fared in the first half of 2020.

Golf Equipment U.S. Sales Jump 51% in June, The NPD Group Reports
Golf Equipment U.S. Sales Jump 51% in June, The NPD Group Reports

With golf courses around the United States reopening and the sport being a social distance-friendly activity, golf equipment sales are surging.

Newsletter

Subscribe and get key market trends and insights relevant to your industry each month.

We will not sell your information. View privacy notice. | Cookie Settings

Follow Us

© 2020 The NPD Group, Inc.