Flood blamed as revenue from Vicksburg sales tax falls

Published 11:44 am Thursday, July 21, 2011

The 2011 flood and a stagnant economy were the main reasons for an almost 11 percent drop in Vicksburg’s sales tax revenues for the month of May, Mayor Paul Winfield said.

Vicksburg receives 18.5 percent of all sales taxes collected by businesses inside the city.

According to statistics from the Mississippi Department of Revenue, the May sales tax disbursement to Vicksburg totaled $561,002.57, which was 10.6 percent less than the May 2010 disbursement of $627,321.53. Because sales tax disbursements to cities run two months behind, the numbers reflect May sales tax collections in the city.

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The latest disbursement is 7.4 percent less than the $606,063 the city received the month before. Year-to-date city sales tax disbursements for 2011 totaled $7,138,314, which is 1.3 percent lower than the $7,233,420 the city had received by the same time in 2010, and about 5.9 percent less than the $7,581,925 the city received the same time in 2009.

Winfield said the 2011 flood that affected the city during April and May not only put people out of their homes, but forced visitors to either reschedule or cancel plans to visit the city.

“People canceled reunions and other events because the national coverage portrayed Vicksburg as being under water,” he said. “That caused a loss of revenue. Also, consumer confidence is still down. People are holding on to their money and not spending.”

He said the Board of Mayor and Aldermen will review the flood’s effect on the city’s sales tax revenue during budget meetings, adding that the board takes a conservative approach to its revenue projections. The new fiscal year begins Oct. 1, and the board must adopt a budget before that.

Winfield said, however, that the city may see an increase in sales tax revenue in August and September as it enters the final months of the 2011 fiscal year.

“I believe we’ll see an increase as consumer confidence improves over the next few months,” he said. “I think we may get close to our projections at the end of the year.”