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Wal-Mart Stores Inc. customers who cashed U.S. tax rebate checks at its stores spent about 25 percent of the proceeds before leaving the stores, slightly boosting July sales, the world's largest retailer said yesterday.
Wal-Mart reported the data when it released same-store sales data for July. Discount rivals Target Corp. and Kmart Corp. did not report on what consumers were doing with proceeds of tax rebate checks cashed in their stores.
With the American economy slowing, analysts have been waiting anxiously for data on whether the rebate -- part of President George W. Bush's 10-year $1.35 trillion tax cut -- would boost consumer spending and economic growth, according to the Associated Press.
After Wal-Mart announced last month that it would cash customers' income tax rebate checks at no charge, other retailers including Kmart, ShopKo Stores Inc. and BJ's Wholesale Club Inc. scrambled to offer the same deal. Ames Department Stores Inc. offered to cash rebate checks, but with a purchase required, the report said.
Wal-Mart said rebate spending bolstered sales in electronics, cameras, prepaid cellular telephones, camcorders, air conditioners, lawn mowers and bicycles. But the company said most of those product categories typically have lower profit margins.