Thursday, December 25, 2003
Copyright © Las Vegas Review-Journal

NEVADA ECONOMY: Tax revenue flowing

Collections up more than twice state's projections for first third of fiscal year

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CARSON CITY -- Spending by Nevada consumers and tourists greatly exceeded officials' expectations for the first four months of the fiscal year, with sales tax revenue growth more than doubling what was projected for the budget.

When the Legislature voted this summer to raise taxes and state spending to record levels, sales tax revenues were projected to grow by 5.1 percent. From the July 1 start of the fiscal year through October, revenues are up 11.3 percent and total $246.9 million.

"This four-month growth trend is much more than was expected in overall revenue collections," Gov. Kenny Guinn said in a statement that accompanied Wednesday's report from the Department of Taxation. "These numbers show Nevada is a great place to live and do business, and that our work on economic development, job creation and tourism marketing is working. I am hopeful Nevada's economic prosperity will continue and the new and existing revenue sources continue to meet or exceed expectations."

Statewide taxable sales had a third consecutive double-digit increase in October.

Taxable sales were $3 billion in October, a 10.8 percent increase over the same month a year ago. Year-to-date taxable sales were $12.2 billion, up 11.3 percent.

Clark County taxable sales were $2.2 billion in October, up 12.1 percent. Clark County taxable sales are up 12.8 percent for the fiscal year.

Chuck Chinnock, executive director of the Tax Department, said other types of tax collections, including cigarette and alcohol taxes raised by the Legislature, jumped in October.

These excise tax collections were $16.8 million, a 56 percent jump over October 2002.

State cigarette tax collections in October were $8.1 million, up 224 percent from the $2.5 million collected in the same month a year ago. Cigarette taxes were raised by 45 cents a pack, to 80 cents, by the Legislature on July 22.

For the four months of the fiscal year so far, the state share of cigarette taxes is $29.1 million, up 113 percent over the same four months last year.

Liquor taxes were raised by 75 percent by the Legislature. For the first four months of the year, liquor taxes are $11.2 million, up 72 percent over the same period last year.

In the taxable sales report, the largest increases were found in eating and drinking establishments, up 10.9 percent; automotive dealers and gasoline, up 10.7 percent; wholesale trade and durable goods, up 22.4 percent; building materials and hardware, up 17.7 percent; and home furniture and furnishings, up 19 percent.

Other categories reporting gains were Clark County eating and drinking places, up 12.3 percent; statewide general merchandise stores, up 7.9 percent; food stores, up 3.4 percent, miscellaneous retail, up 6.5 percent; and apparel and accessory stores, up 7.7 percent.

Six of Nevada's 17 counties, all rural, reported declines in taxable sales in October over October 2002. The biggest drop was 24 percent in Esmeralda County.