Nevada sales tax revenue dives 10.9 percent

Local restaurateur Bob Ansara didn’t need to see Friday’s statewide sales tax report to know business among the city’s eateries has slumped.

Sales at Ricardo’s of Las Vegas, the Flamingo Road restaurant Ansara owns, dipped roughly 8 percent year-over-year through late 2008.

“We are working as efficiently as we can,” Ansara said. “We are making the cutbacks necessary to ensure we will at least be marginally profitable at this level until the economy rebounds.”

The latest analysis from the Nevada Department of Taxation reveals widespread sales contractions for businesses, though the report also contained a few bright spots.

Gains in taxable sales among construction companies, book and hobby shops, food and beverage stores and accommodations failed to offset steep drops in economic activity inside Nevada’s restaurants, furniture stores, car dealerships and clothing boutiques.

Merchants statewide rang up nearly $3.4 billion in taxable sales in November. That’s a 10.9 percent decline from the $3.8 billion they transacted in November 2007. In Clark County, taxable sales came to $2.5 billion, down 11.3 percent compared with $2.8 billion in November 2007.

Revenue collections from sales and use taxes in November amounted to $251.6 million, a 12.2 percent decrease compared with $286.5 million the same month a year ago. Revenue collections were off 6.7 percent in the first five months of fiscal 2009, which began July 1, when compared with the first five months of fiscal 2008.

Still, the general-fund portion of sales and use tax collections was $7.4 million, or 0.84 percent, above fiscal 2009 projections of the Economic Forum, a budget-forecasting panel. Nevada’s general fund finances schools and prisons, among other services.

Car and car-parts dealers saw a 34.4 percent falloff in November sales, while sales at furniture stores plummeted 33.6 percent. General-merchandise stores and clothing shops lost 9.2 percent and 8.7 percent in sales respectively, while restaurant sales dropped 6.7 percent.

At Ricardo’s, a Mexican restaurant where entrees range from around $9 to $20 a plate, executives pared the staff from 83 to 77 to account for the dip in business. The eatery has lost customers to more-affordable restaurants, though it’s also welcomed “refugees” from pricier restaurants, Ansara noted.

Ansara said sales declines at Ricardo’s leveled off in December and January. He said he expects “challenging” times through mid-2009.

Despite a slumping housing economy and work stoppages on some major resort projects, sales related to the construction of buildings expanded 58.1 percent in November. Administrative and support services improved sales by 25 percent, while food and beverage stores saw sales grow 7.3 percent. At stores selling sporting goods, hobby items, music and books, sales jumped 13.1 percent.

Taxes collected on the sale of liquor and cigarettes beat Economic Forum expectations in the first five months of fiscal 2009.

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

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