Tax refund both boon and bust

Lolita Harper

COSTA MESA -- For some businesses, the federal tax refund is doing

exactly what Federal Reserve Chairman Alan Greenspan and President George

Bush expected it to do.

Others regard it as a good promotion gone bad.

Both Home Depot and Ugly Duckling Car Sales have used the tax rebates

as part of their marketing strategy but have seen drastically different

results.

Officials at Home Depot said they have seen an increase in sales

because of the recent tax rebate. In fact, part of their marketing

strategy allows people to cash their refund check in the store while

making a purchase.

Home Depot manager Chad Farwell said he has received many inquiries

from customers about the promotion and expects to see even more shoppers

as more checks are sent out. Although he has not kept specific figures,

Farewell said there has been a definite swell in business already.

“I’d say that a majority of our warehouse sales is due to Bush’s extra

kickback,” Farewell said.

According to Bush’s tax cuts, qualifying households will receive

between $300 and $600 in the coming month or so. The move was intended to

give some of the nation’s surplus back to the people and help jump-start

a slowing economy.

Home Depot customer Mike Murray -- whose cart was loaded with various

home improvement items -- said he plans to spend his rebate paying for

the remodeling of his kitchen.

“I should save it, but it’s all going into my home. With the stock

market the way it is, my house is my best investment,” the 30-year-old

Huntington Beach resident said.

While Home Depot is reaping the benefits of its tax rebate marketing

strategy, Ugly Duckling, a car dealership on Harbor Boulevard, said the

effects have been minimal.

Ugly Duckling has offered to double anybody’s tax rebate when it is

used toward a down payment. In the last month, however, the car

dealership has only sold three cars using that pitch, sales manager

Darryl Sperry said.

“Frankly, it’s one of our worst promotions ever,” Sperry said.

Sperry said he received a few phone calls from potential buyers but

doesn’t expect the tax cut to produce a major increase in sales. Ugly

Duckling does its best business during April, when it offers to do

buyers’ tax returns for free as long as the refund is used as a down

payment, he said.