SAN YSIDRO, Calif. -- With the economy taking a big toll on San Ysidro businesses, officials are hoping a new plan will encourage more people to do their shopping near the U.S.-Mexico border.

Rahil Iqbal's family opened up their first business in San Ysidro more than 10 years ago, and he said it is hard to make a profit these days.

"We have to dip into our savings. That's what we've been doing for the last three to four years. Every year it's a trend," said Iqbal.

Iqbal is not alone, as the San Ysidro Chamber of Commerce said sales near the border have dropped by 65 to 85 percent.

Business is so slow that vendors have to take extreme measures by cutting profits. For example, some venders are selling a dozen pair of socks for just $3.

There is now talk about making the San Ysidro area a sales tax-free zone, meaning shoppers will not have to pay state tax. It's an idea Bazaar at Border Station manager Alfredo Ripa likes.

"In a bad economy, it is a no-brainer," said Ripa.

Right now, the area produces more than $4 billion in sales, and San Ysidro Chamber of Commerce President Israel Adato said a tax-free zone could quadruple that number. The process, Adato said, is not easy.

"You basically have to work with the federal officials. You have to work with your state officials. You have to convince them that there will be no tax dollars lost," said Adato.

Adato said the boom in business would offset the tax loss.

Iqbal and other vendors said they hope they make up the loss during the upcoming holiday season.

The San Ysidro Chamber of Commerce said if the plan goes well, the tax-free zone could be up and running in a few years.