Taxable sales in Nevada drop 1.9 percent in May as tourism-dependent economy remains in slump

Nevada taxable sales drop 1.9 percent in May

CARSON CITY, Nev. — Taxable sales in Nevada fell 1.9 percent in May, a small dip from the previous month but a continued reprieve from the double-digit free fall of a year ago, the Nevada Department of Taxation reported Tuesday.

Merchants in Nevada sold $3.1 billion in goods, of which $33.1 million was reported under an amnesty program designed to spur taxable sales reporting. Without amnesty, taxables sales would have dropped 2.9 percent, the department said.

For the fiscal year, sales have dropped 11.1 percent.

Gross sales and use tax collections totaled $248.1 million for the month, a 3.3 percent increase over May 2009. Collections for the 11 months ending June 30 were off 5.7 percent.

There were some positive indicators in the report, but others showed Nevada’s tourism- and sales-dependent economy remains in a serious slump.

The largest increases were posted in accommodations, up 23 percent; clothing and accessories, up 10.7 percent; electronics and appliance stores, up 15.8 percent; and professional scientific and technical services, up 19.3 percent.

Construction trades, however, which once helped fuel the state’s economy, fell 31.6 percent from the same month in 2009. Sales dropped 1.7 percent at car lots and parts stores and 7.2 percent at food and beverage stores. Durable goods fell 11.1 percent.

Nevada leads the nation in bankruptcies, foreclosures and joblessness. It passed Michigan as having the highest jobless rate in the nation in May and hit a record unemployment rate of 14.2 percent in June.

The economy is the central issue in Nevada’s upcoming elections, particularly in the U.S. Senate race. Democratic Majority Leader Harry Reid, seeking a fifth term in November, says he’s helped bring thousands of jobs to the struggling Silver State. Republican challenger Sharron Angle counters Democratic policies have exacerbated the state’s dire economy.

In Clark County, which includes Las Vegas and is Nevada’s most populous, combined sales fell 1.4 percent. Northern Nevada’s Washoe County, which includes Reno, saw sales drop 3.8 percent.

Twelve of Nevada’s counties posted declines, the report said. Only Esmeralda, Eureka, Lincoln, Pershing and White Pine counties had positive sales figures, though with largely rural economies, their monthly reports are often skewed by purchases of large equipment.

In other counties around the state, sales fell 5.8 percent in Carson City, 6 percent in Douglas, 3.2 percent in Elko, 12.7 percent in Storey and 0.8 percent in Lyon.

Gov. Jim Gibbons took heart that the steep drops have eased.

“After more than a year of double-digit monthly declines, this continues six successive months of positive or single-digit declines, despite an unemployment rate that continues to edge upward,” he said in a written statement.

Tuesday’s report said the portion of gross collections that goes to the state general fund is $21.5 million or 3.2 percent greater than projections the state Economic Forum made in January for the first 11 months of the fiscal year.