Greensboro/North Carolina: Wal-Mart Stores Inc, the world’s largest retailer, will cash tax rebate checks for free and cut prices on shampoo, cereal and groceries to encourage buying in its stores.

Wal-Mart stores discounted prices this week and plan further reductions as Americans receive rebate checks, the Bentonville, Arkansas-based company said in a statement. The retailer will also refund the purchase fee on its Wal-Mart MoneyCard when any portion of a rebate check is loaded onto the card.

Congress voted for the rebates in February as part of a $168 billion package to stimulate an economy slowed by record mortgage foreclosures, job cuts and rising prices of food and fuel.

Payments will be as much as $600 for individuals who made $75,000 or less and $1,200 for married couples with household incomes as high as $150,000.

Each eligible child is worth $300 more.

Still, the total payout will be less than a third of the $389 billion Americans spent on gasoline last year.

Wal-Mart, which cut prices in 2007 to boost profit the most in three years, wants to extend those gains by winning sales from consumers who start getting $117 billion in tax rebate checks this week. Kroger Co, the biggest US supermarket chain, and electronics retailer RadioShack Corp are among Wal-Mart rivals offering their own spending incentives.

Wal-Mart should see “some intermediate benefit” from rebate spending, Virginia Genereux, a Merrill Lynch & Co analyst in New York, wrote in an April 25 report to clients. She cited the potential extra spending in upgrading the stock to “buy” from “neutral.”

Wal-Mart fell 30 cents to $57.35 on Monday in New York Stock Exchange composite trading. The stock climbed 21% this year through yesterday, the best performance among the 30 members of the Dow Jones Industrial Average.

Customers who cash rebate checks at Wal-Mart will probably spend them there, Jack Shewmaker, a director and retired vice-chairman of the retailer, said in an April 10 interview in Barcelona.

Kroger, based in Cincinnati, is offering a taxpayer incentive. Starting May 2, customers who exchange tax refunds or rebates for a Kroger gift card will get an extra $30 for every $300 they put on the card, the grocery chain said April 16. Eden Prairie, Minnesota-based Supervalu Inc, the second-biggest US supermarket chain, is offering the same deal.

RadioShack, the third-largest US electronics retailer, will offer a 10% discount on purchases of $50 or more when a rebate or tax refund is used to pay for them. The offer starts May 4, the Fort Worth, Texas-based company said April 24.

Source : DNA