Taxable sales decline

Taxable sales across Nevada nosedived again in March, posting a 16.5 percent decline compared with March 2008, the state's Department of Taxation said Friday.

March's falloff came on top of a year-over-year decrease of nearly 20 percent in February.

Statewide taxable sales totaled $3.6 billion in March, down from $4.3 billion a year earlier. Nevada's taxable sales -- purchases of goods and products from retailers and businesses -- have fallen for 24 straight months, as consumers and companies have continued to rein in spending amid the nation's long recession.

Taxable sales in Clark County dropped 14.5 percent year-over-year in March, going from $3.2 billion to $2.8 billion.

Sixteen of the Silver State's 17 counties posted sales declines in March. Only Lander County, in north-central Nevada, recorded improved sales.

Gov. Jim Gibbons said in a statement that the latest numbers point to sustained economic travails, and he warned that additional troubles could follow the Legislature's decision to quash his veto of state lawmakers' tax plans.

"The slow housing market, volatility in the stock market, decline in business activity and consumer spending all portray the overall weakness in our state's economy," Gibbons stated. "I am very concerned that the Legislature's decision to override my veto of their huge tax package will bring even more economic pressure and misery to Nevada's citizens and businesses."

Taxable sales are important because the revenue the state gathers from such transactions helps finance schools and prisons, among other services.

The sectors hardest-hit by the recession again posted the steepest sales drops.

Furniture stores' sales plummeted 40.8 percent, while sales of construction-related goods slumped 33.5 percent. Purchases from clothing and accessories retailers were down 18.6 percent, and consumers bought 6.8 percent fewer drinks and dinners from restaurants and bars. Dealers of cars and car parts lost 39.2 percent of their sales year over year.

The sales drought for car retailers was especially evident Friday, when one of Southern Nevada's oldest auto dealers said it would close immediately.

Executives of the 67-year-old Pat Clark Auto Showcase said in a statement that the company's sales had "diminished to nearly nothing," and they could no longer maintain the "skeleton crew" they had on staff.

The company said the recession, trouble for the nation's Detroit Three automakers and a local unemployment rate that's surpassed 10 percent for much of 2009 have ruined sales for local dealers. Dealerships that sold hundreds of cars a month in better times now see monthly sales in the single digits, the company said.

Several other area car dealers, including three Chrysler stores, a Hyundai store and a big national Chevrolet dealer with a major local presence, have closed since fall.

Still, some corners of the economy fared well in March. Wholesalers of durable goods -- long-lived, big-ticket items such as major appliances -- increased their sales by 42.7 percent. Mining sales rose 17 percent. Sales by machinery makers jumped 15.2 percent, and educational services boosted sales by 92.2 percent. Sales for performing arts, spectator sports and related industries gained 21.5 percent.

Revenue collections from sales and use taxes in the first nine months of fiscal 2009, which began July 1, came in at $267.5 million, down 11.2 percent compared with the first nine months of fiscal 2008.

But the general fund portion of sales and use revenue beat the expectations of the Economic Forum, a group that predicts how much revenue will be available for state programs. The general fund's share of sales and use taxes was $5.8 million, or 0.7 percent, above the forum's May projection for the first nine months of the fiscal year.

The Department of Taxation also noted that collections from the state's payroll tax dropped 6.8 percent in the quarter that ended March 31, falling to $68.1 million. The Economic Forum forecast $284 million from the payroll levy in fiscal 2009, but so far, despite the most recent quarter's drop, collections are ahead of forecasts by $3.8 million, or 1.3 percent.

Excise taxes on cigarettes and liquor slipped below expectations for the fiscal year to date.

Cigarette taxes were $149,000, or 0.2 percent, below forecasts, while revenue from liquor taxes was $1.8 million, or 4.7 percent, below projections.

Collections on the real property transfer tax were 28 percent below anticipated numbers.

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512.