Use-tax decline takes steam out of sales-tax growth

Lifting drywall onto a high floor of the new addition of the Avalon Theatre Tue afternoon.



Sales tax collections in Grand Junction inched higher this year through April representing a 2.5 percent increase over sales tax collections during the same period last year. However, declining use taxes — a tax which in the Grand Valley mostly represents sales of capital improvement investments in the oil and gas industry — pulled overall gains down to a 1 percent increase in total taxes collected for Grand Junction city coffers.

The numbers include year-to-date figures through April, compared to the same time period last year.

Grand Junction collected $16.2 million in sales taxes so far this year, compared to $16 million during the same time last year. The numbers are down from 2012 figures, which show Grand Junction collected nearly $16.7 million during the same time period.

Grand Junction city officials further break down the categories where sales tax revenue is derived. Businesses selling items to other companies such as software products, supplies and furniture represented the largest gains, or a 19.1 percent increase over last year. Other top-performing categories included taxes derived from motor vehicle sales, which experienced 10.7 percent growth over last year; construction industry spending, a 9.7 percent increase over last year; and taxes from sales at restaurants and bars, producing a 4 percent increase.

Sales tax revenue in Grand Junction’s aviation industry experienced the sharpest decline, or a 37.8 percent dip year over year. However the aviation industry category only represents one-half of a percent of the city’s overall sales tax collections. Revenues from oil and gas extraction were down 22.2 percent in the first quarter and retail sales dipped by 5.8 percent. Sales tax revenue from retail sales represents the city’s largest sector of sales tax collections or 20.2 percent. Over the past five years, sales taxes from retail sales have increased 4.5 percent. Gross retail activity was up 5.7 percent in this year’s first quarter, compared to the same time last year.

“When you see gross retail activity show stronger growth than sales tax revenues, it is generally due to increases in transactions that are exempt from sales tax,” said Elizabeth Tice-Janda, revenue supervisor for the city of Grand Junction. “The city of Grand Junction exempts many items from sales tax including gasoline, medicine, residential fuel, food for home consumption and sales to not-for-profits and governmental entities.”


COMMENTS

Commenting is not available in this channel entry.


TOP JOBS
Search More Jobs





THE DAILY SENTINEL
734 S. Seventh St.
Grand Junction, CO 81501
970-242-5050; M-F 8:00 - 5:00
Editions
Subscribe to print edition
E-edition
Advertisers
Advertiser Tearsheet
Information

© 2015 Grand Junction Media, Inc.
By using this site you agree to the Visitor Agreement and the Privacy Policy