Sales Tax Collections Sharply Lower in Some Coast
Every since Hurricane Katrina hit August 29, 2005, city officials have been watching carefully the impact of the storm on sales taxes, which reflect the overall economic heath of the area. The State Tax Commission collects sales taxes from business activities across the state and the report for November, which reflects taxes actually collected in September, indicates substantial reductions for some Coast communities that had shown sharp increases after the hurricane. The figures also show that some Coast Communities are slowly recovering, but the overall picture indicates there are problems.
Gulfport, D'Iberville, Ocean Springs and Pascagoula showed sharp declines from the 2005 November report. Those communities benefited from the post-Katrina spending as their shops and stores remained after the hurricane and many Coast residents made purchases from those communities. As stores have reopened in Biloxi, Waveland and Bay St. Louis, those cities have experienced increases.
The figures from the State Tax Commission for the entire state are also indicating a slowdown in spending statewide with sales tax diversions for November 2006 at $29,595,121.55 compared to 2005 at $32,595,086.66.
Sales taxes are a key component to a city's ability to provide services, but they are not the only source of income. Sales tax diversions that are returned to city's collected by the State run two months behind when the taxes were actually collected. November's report reflects taxes on September sales that were to be filed by businesses by October 20. The Tax Commission then compiles the data for each report the following month.
There is some good news for hard hit Bay St. Louis, Waveland and Pass Christian where sales tax collections showed substantial improvements over the previous year, especially for Waveland where sales taxes have increased from $64,205.63 in 2005 to $249,339.55 for November 2006.