Stalled Sales Tax Revenue - Stalled Economy

Washington CEO confirms the continued slump in retail sales tax revenues (here's the state revenue department report). WA CEO writer Bryan Corliss summarizes the bad news:

As a whole, Washington companies did $26.6 billion worth of activity subject to sales taxes in during the first quarter 2008 - a scant 1.4 percent increase over 2007's first quarter. When you compare that to previous years, the slow-down is striking. Between Q1 '05 and Q1 '06, for example, state sales tax collections jumped 10.3 percent. Between Q1 '06 and Q1 '07, they were up 7.9 percent.

For another look at the situation, consider this chart presented by WRC president Al Ralston at a recent AWB government affairs committee meeting. Hard to see signs of an uptick before the September revenue forecast.

Corliss again:

... for now, two things are clear: Washington's economic growth has largely stalled; and state and local governments will have lots of belt-tightening to do during their next budget cycles.

Agreed. Here's AWB president Don Brunell's take on the story.