Sales up, could help ease budget shortfall

CARSON CITY - It was a green Christmas - as in cash - for Nevada merchants who sold $2.68 billion in goods in December and provided more evidence that a predicted tax revenue shortfall is overstated.

The state Taxation Department reported Tuesday that the December sales were up 9.1 percent over the same month a year earlier.

The increase was a full percent higher than matching November and October gains, and brings the growth in the state's cut of sales taxes for the fiscal year to date to a healthy 8.6 percent.

The average is higher than the 6.9 percent growth projected for the entire fiscal year by the state Economic Forum. The forum's dismal forecast prompted Gov. Kenny Guinn to call for numerous budget cuts.

The forum will meet again at the end of April to revise its predictions based on the latest data on collections of sales, casino and other taxes.

If sales are strong enough during coming months to keep the average at 8.6 percent, a projected $140 million revenue shortfall would shrink by more than $10 million.

It would drop even more if casino-related taxes continue to show strong growth - a good possibility because of the scheduled opening this spring of more megaresorts in Las Vegas.

Casino taxes are up 8.8 percent through December, also above the earlier projections that figured in Guinn's budget-cutting decisions.

Regulators have said the casino tax take could run at a negative 2.6 percent for the rest of the fiscal year and it would still hit the Economic Forum's estimate a few months ago.

Casino-related revenues and sales taxes account for three-quarters of all revenues needed to run state government.

A breakdown of the latest sales report shows the Las Vegas area had $1.9 billion in sales during December, up 12.7 percent.

In the Reno area, sales totaled $464.6 million for a 5.3 percent increase.

Elsewhere in Nevada, Elko County taxable sales decreased by 12.3 percent over December 1997. White Pine County was down 15 percent, Humboldt County was down 9 percent, Churchill was up 12.7 percent, Douglas was up 5.9 percent and Carson City was up 10.6 percent.

Statewide, auto sales were up 22.5 percent; general merchandise sales were up 6.6 percent; clothing store sales were up 11.6 percent; and building supply sales were up 7.9 percent.

A tourism-related category, eating and drinking places, was up 15.8 percent statewide. A breakdown shows an 18.7 percent gain in the Las Vegas area and an 8.9 percent increase in the Reno area.

The state's share of sales taxes during December totaled $54.8 million, up 10 percent over December 1997.

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