Despite damage sustained by local businesses and homes in the February tornado, sales tax revenue for Sharp County has increased since last year and from March to April of this year. Many factors are affecting the county's sales tax revenue, one of which is the recent and major change in the Arkansas sales tax collection laws.
According to the Department of Finance and Administration's Web site, effective as of Jan. 1, 2008, "If your business makes a retail sale of property and delivers the tangible property through common carrier, truck, mail or by any other shipping or delivery method to your customer, you will charge the state, county and city taxes based on where the purchaser takes receipt or delivery."
This means that any tractor trailer rented for hauling garbage and debris, construction material brought to Highland for the purpose of rebuilding or any other services contracted from another county, city or state, pay their sales tax to Highland and to Sharp County.
Sharp County Treasurer Wanda Girtman explained that natural disasters can have varying effects on the spending habits of consumers including the additional needs of contracted goods and other materials.
"Right after a disaster people buy a lot of stuff they don't normally buy," Girtman said.
The construction taking place all around the county and specifically in Highland seems to be helping to keep sales tax revenue at a steady increase.
Sales tax collected by Sharp County for the month of February and dispersed in the month of April increased by over $6,000 from the sales tax dispersed in March. In 2007, the increase from March to April was only around $3,500. Sales tax dispersed in April 2008, also increased by over $9,000 from the funds dispersed in April 2007. Girtman also said she is expecting the increase to level off by next month.
"We'll probably see it level off mostly due to gasoline prices costing people so much money that the money they would normally spend at Wal-Mart they will have to spend on gas," Girtman said.
In direct correlation with rising gas prices is the rise of price for other materials transported to the local area. Higher prices on goods and services means more income for the county in the form of sales tax revenue.
"Sales tax revenue has a lot to do with how much something costs; if you pay more for products you'll pay more in sales tax," Girtman explained.
Highland City Council Recorder/Treasurer Mary Ruth Wiles said she didn't know what to expect for sales tax revenue collected for the month of February, but she was very pleased with the city's last sales tax check.
The city of Highland saw an increase of around $500 from March to April. Despite this increase, there was a significant decrease of tax revenue funds from April 2007, to April 2008. In April 2007, Highland collected $32,883.69, and in April 2008, only $25,058.63 was dispersed. With a decrease in sales tax revenue of nearly $13,000 from January 2007 to January 2008, April's decrease seems to be an improvement.
Girtman and Wiles said they cannot be certain of what the county will be looking at next month for sales tax revenue. Girtman said she continues to hope for the best and plan for the worst.