CAMBRIDGE, Mass. (AP) – William Daya was planning to buy electronics for his new apartment last weekend, but then he heard about the state’s sales tax holiday.

“It’s a rare occasion, so why not take advantage of it?” said Daya, a student at the University of Massachusetts Medical School in Worcester.

Daya went to the Best Buy in the CambridgeSide Galleria on Saturday afternoon to buy a plasma television, DVD player and surround-sound speakers. He planned to spend about $1,000, which meant a savings of $50 in taxes.

The state’s 5 percent sales tax has been suspended this weekend on purchases under $2,500. Certain items do not qualify for the tax holiday, however, including cars, motor boats, tobacco products, utilities, telecommunications services, meals, and business purchases.

This is the state’s third tax holiday. Each year, the holiday is held in August, a time that retailers say is one of the slowest months of the year. The first tax-free day in 2004 brought in about $400 million for retailers and cost the state $10 million in tax revenue. Last year’s holiday, which was expanded to two days, generated nearly $500 million in total sales, and cost the state $15.4 million in tax revenue.

By the end of 2006, 13 states and the District of Columbia will have had tax holidays. Most state tax holidays last longer than two days, but are often limited to clothing, back-to-school items and computer equipment.

Some stores in Massachusetts featured special sales on top of the tax discount. The Sears store in CambridgeSide Galleria brought in discounted outlet appliances for bargain-hunting shoppers.

Many stores extended their hours this weekend to allow customers to take advantage. The Apple computer store in CambridgeSide Galleria is staying open for 48 hours straight, from midnight on Friday night to midnight on Sunday night. The store was teeming with customers on Saturday.

Increased staff was also on hand to cater to the expected surge of customers this weekend. The Sears store in CambridgeSide Galleria usually schedules 80 employees to work on weekends, but decided to nearly double its staff this weekend.

General manager Jonathan Coe said this year’s tax holiday “is trending better than last year.”

Otis and Zelpha Bennett were going to wait until winter to buy a new clothes dryer, but the tax holiday convinced them to make the purchase this weekend. They bought the $400 appliance at Sears on Saturday. That’s a savings of $20.

“We thought this would be a good opportunity,” said Otis Bennett. “Every little bit helps.”

Not all shoppers are using the tax holiday to buy big-ticket items. James Taylor waited until this weekend to buy a camera for $19.99 and a George Foreman Grill for $19.99.

Taylor plans to put the $2 he saved Saturday toward a plane ticket to a relative’s wedding in Alabama.

Best Buy supervisor James Marcone said more people are coming out for the 5 percent tax holiday than for more aggressive sales the store has had in the past. Two years ago, he said the Best Buy at CambridgeSide Galleria held a 10 percent sale on everything in the store during the week preceding the tax holiday. Customers ignored that, but then came in droves for the tax holiday, he said.

“You hear the word ‘tax’ and it transcends money and becomes about you and the government,” he said. “It’s the mentality of people being able to pull one over on Uncle Sam.”

AP-ES-08-12-06 1848EDT