The Fontaine family from Barrington — from left, Justin, 15, and Leslie and Danny — crossed the border to shop for a large flat-screen television at Best Buy in Seekonk Saturday to take advantage of the tax holiday.

AP / Stew Milne

Some retailers in Massachusetts said yesterday that the annual sales tax holiday held over the weekend once again turned out to be good for business — particularly in such a bad economy.

“Things went very well,” said Al Mello, sales manager at Nate Lions Appliance Warehouse in Fall River. “It was a very successful sale.”

Business also was strong at Raymour & Flanigan Furniture stores in Massachusetts. The chain has a store in Seekonk.

“We saw a significant increase in both people shopping and purchasing in the two-week window surrounding the tax-free weekend in Massachusetts,” according to Vicky D’Agostino, director of communications for Raymour & Flanigan.

“It was a very substantial increase, up to four times the amount of sales in our three Massachusetts stores over the previous weekend,” D’Agostino wrote in an e-mail to The Journal.

The two-day holiday, which is in its fifth year, offers shoppers a tax break on many items, including appliances, computers and furniture. The tax breaks typically bring out back-to-school shoppers and people looking to save money on big-ticket items.

Raymour & Flanigan operates more than 70 stores in the Northeast, including 3 in Massachusetts, 1 in Rhode Island and 11 in Connecticut.

“The tax-free weekend is responsible for bringing more traffic into our stores and the market in general,” Michael Carter, vice president of sales for Raymour & Flanigan in New England, was quoted in D’Agostino’s e-mail. “Since many of our customers live in one state but near enough to the other states, they typically choose a store that’s closest to their home,” Carter said.

During the holiday, shoppers in Massachusetts stores are exempt from paying the state’s 5-percent sales tax on purchases up to $2,500. Sales of telecommunications services, tobacco products, gas, steam, electricity, motor vehicles, motorboats, meals and items priced above $2,500 remain subject to the sales tax. Also, prior sales and layaway sales are ineligible.

Last year, shoppers spent more than $500 million in Massachusetts during the tax holiday.

The amount of tax money the Bay State gives up on the holiday has risen each year, from $10 million in 2004 to $17.5 million last year, according to the Massachusetts Department of Revenue.

Massachusetts was among 14 states, as well as the District of Columbia, that held tax holidays last year, according to the Federation of Tax Administrators, a lobby group in Washington, D.C.

Two others joined the group this year — Vermont and West Virginia.

Massachusetts officials said that when the final tally is made, they expect the state will have given up $16 million in taxes over the weekend.

The tax-free period in Massachusetts came after a month in which sales at U.S. retailers increased only 0.4 percent as consumers coped with higher gasoline prices and tighter credit. Overall, the 5-percent inflation rate is running at its fastest pace in nearly 20 years.

U.S. retail sales growth slowed in the first week of the month, rising just 2.6 percent from the same period a year ago, according to the International Council of Shopping Centers. That was the slowest pace since 2001.

Sales at Bay State retailers have been flat or down as much as 5 percent, according to the Retailers Association of Massachusetts and corporate financial filings.

“I’m not going to say business is great,” said Mello, of the Nate Lions store. “I think people are buying things if they need them.

“If your refrigerator breaks you can’t put the food outside.”

The weekend can be something of a tradeoff for chains such as Raymour & Flanigan, which have stores in multiple states.

“We did see a slight drop-off in the Warwick and Waterford, Conn., stores, which we attribute to customers taking advantage of the tax savings in Massachusetts,” Carter wrote. “Our Seekonk location in particular experienced heavy traffic and sales for customer merchandise pickups.”

Rhode Island does not hold a holiday from its 7-percent sales tax. In 2006, the General Assembly rejected a sales-tax holiday for the state, the second consecutive year the measure went down to defeat.

That elicits complaints from some retailers here and prompts them to offer discounts intended to neutralize the Massachusetts tax break.

“We’re a discount store so our prices are normally lower than the big-box stores,” said Lisa Sienkiewicz, owner of Gil’s Television & Appliances in Bristol.

But that didn’t stop her from running a rebate program this month intended to draw customers. The store also exempted customers from the sales tax if they took delivery in Massachusetts.

In North Smithfield, Danny’s TV & Appliance generated sales by offering a 7-percent discount all last week, according to co-owner Denise Alexandre.

“It was packed,” Alexandre said. “[Rhode Islanders] all want a tax holiday, too.”

Despite last week’s successful promotion, she railed at state officials who’ve so far rejected a Rhode Island tax holiday.

“We’re taking the hit for this,” she said. “Rhode Island doesn’t protect its small businesses.”

pgrimald@projo.com