Auto Sales Generate Most Sales Tax Revenue
Florida's October sales tax revenues show additional evidence that consumers are buying cars.
The state's collection of automobile sales tax in October was "significantly over" estimates, reflecting the sector's robust sales, according to a state revenue report released this week.
Without the boost from auto sales, Florida's sales tax revenue would have fallen below previous estimates, said Amy Baker, Florida's chief economist.
The report follows Fort Lauderdale-based AutoNation's report that its new vehicle sales increased by 13 percent in October, compared to a year ago. The nation's largest car and truck retailer sold 20,958 new cars and trucks during the month.
Florida's automobile sales tax collection was over the August estimated numbers by $12.9 million, or 5.4 percent, according to the Office of Economic & Demographic Research. Sales tax collection for consumer nondurables, tourism and building also were over the estimates, though by smaller amounts.
In Fort Lauderdale, taxable sales were up 5.7 percent, with automobiles up 16.3 percent. West Palm Beach's taxable sales rose 4.2 percent, with automobiles up 11.4 percent.
A new Economic Estimating Conference report also was released by the state. The unemployment rate is forecast to hold steady through the first quarter of 2013, but then begin a slow decline, not falling below 8 percent until the fourth quarter of 2014. The jobless rate was 8.5 percent in October.
The November forecast, by a group of state economists, didn't change much from the summer, Baker said.
Personal income reached its peak in early-2012 and is now on a steady rise, she said.
In South Florida, personal income jumped 4.6 percent in the last year to $43,072 per person, but the rate of increase fell below the U.S. average, according to federal statistics.
Statewide, personal income is forecast to increase by 4 percent in 2013 and go as high as 5.4 percent by 2016.
"The recovery is well underway, but it's just slow. Unless there's another financial shock, it's just getting the timing right," she said.
The forecast doesn't factor in Congress' handling of federal fiscal cliff issues, including the potential impact on the state's defense contractors from military budget cuts. Democrats and Republicans are in negotiations to avert the Jan. 1 fiscal cliff, the start of about $600 billion worth of tax hikes and automatic spending cuts.
"At the end of the day there will be some kind of agreement, a mixture of tax changes and budget cuts," Baker said. She said state economists did take into consideration that there will be some "slowing and concerns until an agreement is reached."
"We've built in a little cautiousness," she said.
Source: Sun Sentinel
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