Sales tax collections grow at slower rate in June

Monthly receipts of the 1-cent sales tax Hot Springs levies in support of its general fund showed a fifth-straight year-over-year increase but slower growth than previous months, according to figures the city’s finance department released last week.

June collections remitted in July rose 2.72 percent compared to June 2015. For the year, collections have outpaced the first half of last year by 6.93 percent. The $1,188,026 collected in June marked a $31,473 increase from the previous year and $47,527 more than the monthly projection.

The $6,542,647 collected through the first six months exceeds projections by $296,600, or 4.7 percent. The general fund sales tax raised $12,581,886 last year. The city also collects a half-cent sales tax for its police and fire funds, with 60 percent going to the police department and 40 percent to the fire department.

The year-over-year percentage increase slowed in June after gains of 5.9 percent in March, 5.14 percent in April and 7.27 percent in May. While lower gas prices give tourists more money to spend, Visit Hot Springs CEO Steve Arrison said it could be affecting the incomes of people who work in the oil and gas industry in neighboring states.

“In talking to some of our hoteliers, one impact I haven’t thought about is lower gas prices,” he said. “A lot

of people in our market area could’ve had their employment cut back.”

Arrison expects July sales tax receipts to be flat or rise only modestly, saying the slowdown is consistent with a “softening toward the end of summer.” He said receipts of the 3-percent tax the city’s advertising and promotion commission assesses on prepared food and lodging inside the city are usually at their strongest in March and July.

June collections remitted to the advertising and promotion commission in July dipped 0.72 percent compared to last year, but Arrison said the $3,524,482 raised through the first half of 2016 is 5.15 percent more than receipts generated during the first six months of last year.

May collections of the halfcent sales tax Garland County levies in support of its general and solid waste funds were up 3.27 percent compared to last year. The $743,252 collected was a $24,322 increase over May 2015. The $3,567,681 collected through the first five months marks a 4-percent increase over last year.