It’s been an annual tradition for the past 11 years, but this year’s tax-free week may be the busiest the state has seen since its inception.

The seven day tax holiday which starts Aug. 21 and runs through Aug. 27 comes on the heels of the state’s sales tax increase from 6 to 6.35 percent.

However, Peter Gioia, vice president and economist for the Connecticut Business and Industry Association, believes consumers will be more inspired to do their back-to-school shopping next week because of the new tax on clothing and shoes under $50.

“That makes a big difference to back-to-school shoppers,” Gioia said.

“This is a great opportunity for back-to-school shoppers and we expect it to be a big hit this year,” Department of Revenue Services Commissioner Kevin Sullivan said. “It’s also a good way to help Connecticut’s retailers attract customers and put more money back into the state economy.”

And the good news for coupon clippers is that because the sales tax is applied to merchandise after the use of any coupons or discounts, shoppers may be able to sneak in retail purchases for more than $300.

In addition to purchases shoppers take home, items placed on layaway and rentals of clothing or footwear under $300 are also tax-free during the tax-free week. For purchases of items costing $300 or more, sales tax is calculated on the full cost of the item.

The Office of Policy and Management has estimated the state will lose $7.2 million in tax revenue over the seven-day period, Sarah Kaufman, spokeswoman for the state Department of Revenue Services, said. But the revenue loss to the state may benefit retailers and the state’s economy.

“I think it will see the heaviest use in a long time,” Gioia said. 

The sales tax exemption applies to each purchase under $300 and it applies to both in-state and out-of-state retailers required to collect Connecticut sales tax.

Click here for the rules.