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Sales tax month is record highest yet

October 20, 2012


August 2012 marked the second month on record where Starkville sales tax revenues crested $500,000, but 2 percent hotel tax revenues for the month were significantly lower than those in August 2011, according to the city of Starkville’s latest sales tax report.

Sales tax revenue for August 2012 reached $500,299.57, a 1.95 percent increase over August 2011. Monthly revenue has only crested $500,000 once before, with $508,192.88 in December 2011, making August 2012’s revenue the second-highest on record.

The total recorded sales tax revenue for 2012 so far stands at $3,663,747, with an average monthly revenue of $457,968.38. By the same month in 2011, sales tax revenue was at $3,541,990.98, and the final average monthly revenue for the year as a whole was $454,264.50, so revenues for 2012 are on track to exceed those for 2011.

These increases in sales tax figures came despite a sharp decrease in 2 percent hotel tax revenues and a smaller decrease in 2 percent restaurant tax revenues. The hotel tax revenue fell from $17,926.75 in August 2011 to 10,974.36 in August 2012, a decrease of 38.78 percent. Restaurant tax revenue fell from $144,208.08 in August 2011 to 131,525.68 in August 2012, a decrease of 8.79 percent.

Jennifer Gregory, vice president for tourism development with the Greater Starkville Development Partnership, said business at restaurants, hotels and other tourism venues has grown overall since 2011. Which months show that growth might vary depending on the way events are scheduled each year, she said.

“A lot of the tourism we see in the summer, specifically in August, correlates directly with orientation schedules and summer camp schedules,” Gregory said. “Sometimes we might see a real surge in September compared to what we might expect in August.”

Starkville Mayor Parker Wiseman said it is difficult to pin down specific variables that might influence tax revenues for a given month, and long-term trends show a clearer picture. Right now, he said, those long-term trends are still strong across the board.

“The positive sign is that for the year, there’s still a significant gain for both general sales tax and 2 percent sales tax, and we’re far enough along in the year now to really establish a trend line,” Wiseman said. “It looks like this is going to turn out to be a really good sales tax year, barring something unforeseen in the final quarter.”

Gregory said she is pleased with the high general sales tax figures and the continuous growth they have shown.

“This month being one of the highest on record, I think it definitely speaks to the positive economy we’re having in Starkville and Oktibbeha County,” Gregory said. “Additionally, many Starkville residents are making it a habit to shop locally, and we are really seeing the benefits of that to our community. We’ve seen growth in the enrollment at MSU, so ... we look for those numbers to remain steady and increase.”

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