City sees increase in sales tax, home rule tax ? Local ? Mt. Vernon ...

MT. VERNON ? Despite ending a string of successive months of increases in the city?s sales tax and home rule tax receipts in April, the city rebounded with increases in the receipts for May, according to figures from the city?s finance department.

Sales tax receipts showed the largest improvement in May between the two with an 8.8 percent increase over the same month the fiscal year prior with $462,490, compared to $425,073 last year. Receipts, however, were down 5.6 percent in April, falling from $438,054 in FY 2011 to $413,345 this fiscal year. That decline ended a nine-month run of similar increases that began in July on FY ?11.

The city?s fiscal year began May 1.

The decline also lowered the city?s year-to-date intake for actual receipts this year as compared to last year, though it remains in the black for an increase of 1.5 percent, with a jump of $12,708 for April and May over the same time period last year. Year to date, the city has brought in $875,836, nearly $10,000 under what was projected thus far for the year. ?

The 1 percent home rule tax showed a similar blip in its six-month run of increases, dropping 4.6 percent in receipts for April but climbing back 2.2 percent in May. In April, home rule tax receipts were $301,330 compared to $315,948 the year before. In May, receipts were $320,847 compared to $313,862 the previous year. Receipts to date are $20,157 under what was projected in this year?s budget. Projections are based on the previous year?s receipts with roughly 3 percent added.

Finance Director Merle Hollmann noted that both taxes are a reflection of the health of the local economy and pointed to large-ticket purchases such as automobiles as another good indicator. Given that there was a significantly higher increase in sales tax receipts over the home rule tax in May, Hollmann said he believes many people purchased vehicles that month. Home rule tax applies to the same purchases as sales tax excluding merchandise requiring titles or licensing such as automobiles and boats. Also, groceries, prescription drugs and medical equipment are excluded. ?

?We are growing. We have more retail establishments and a broader base. And, consumer confidence is up,? he said. ?We are spending more money.? ?

Much of that spending, he added, is coming from people who work in Mt. Vernon but live elsewhere.

Meanwhile, state income tax payments to the city, though three months behind in being paid, are also on the rise, up by 7.3 percent in year-to-date comparisons between this fiscal year and last, from $290,606 for May, June and July receipts last fiscal year to $311,849 for the same period this year. July marks the sixth straight time there has been an increase when comparing receipts of the same months but different fiscal years.

Hollmann noted that while the state continues to be behind in its payments, the number of months behind is improving. Fortunately, he added, the city has been able to cover its expenses despite the cash flow delays from the state.

Source: http://register-news.com/local/x1685976316/City-sees-increase-in-sales-tax-home-rule-tax

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