Taxable sales in state fell in December

Thursday, Feb. 28, 2002 | 11:01 a.m.

SUN CAPITAL BUREAU

CARSON CITY -- The holiday shopping season wasn't so cheery for Nevada merchants, with taxable sales falling 4.5 percent in December compared to a year ago.

Dave Pursell, director of the state Taxation Department, said the crowds were good but businesses reduced the price of their goods so total sales fell.

The decline came after two months of modest gains in taxable sales. October recorded a 2.9 percent increase and November registered 1.5 percent.

While the economy is struggling, Pursell said there are signs it is stabilizing. "People are going to Las Vegas again. And they are going out to restaurants."

In September, when the terrorist attack occurred, business at eating and drinking businesses statewide fell by 8.6 percent. In October sales were off 7 percent, then 5.4 percent in November and 4.6 percent in December.

So it appears that the bar and food business is starting to climb back, Pursell said.

Restaurants and bars produce the biggest revenue from the state's sales tax, followed by car sales.

The Taxation Department reported Wednesday that taxable sales fell to $2.935 billion in December compared to $3.075 billion in the same month of 2000. Clark County business was off 4.3 percent to $2.093 billion in December.

Only three counties -- Churchill, at 4.5 percent, Carson City at 5.1 percent and White Pine County at 3.7 percent -- registered increases in taxable sales. Washoe County reported a decline of 3.1 percent.

The department said auto sales statewide rose 5.2 percent; business in food stores was up 15 percent and general merchandise stores inched up 2.5 percent.

But sales of building materials fell 7.1 percent statewide; home furniture was off 9.1 percent and miscellaneous items declined by 5.2 percent.

In Clark County, the eating and drinking business declined by 5.2 percent compared to a year ago in December. Business in home furniture stores was off 9.5 percent; apparel sales declined 2.6 percent and building materials dropped by 6.4 percent.

But Clark County food stores registered a 14.3 percent gain in sales and auto sales were up 3.2 percent.

Auto sales, with low or no interest rates, carried the Nevada sales tax since Sept. 11, Pursell said. In October the business was up 20 percent and 16 percent in November. But now it is starting to tail off.

"We've got to get something to replace the car sales," Pursell said. "And it hinges on the tourists getting back to Las Vegas."

Pursell said the state "held its own" in the collection of sales tax revenue. The receipts in December were off only .20 percent or $118,920 in the receipts from the state's 2-cent share of the sales tax.

Despite sales being down, Pursell said some back taxes were paid to supplement what was collected in the month.

For the first six months of this fiscal year, the sales tax receipts are coming in 3 percent ahead of the last year. But they still trail the prediction of the Economic Forum, which forecast a 6.1 percent increase in sales tax collections this fiscal year. Pursell said at this point the state is short about $10 million compared to what was predicted.