Wilkes County government’s retail sales revenue for June 1 through April 30 was 12.36% ahead of the same period last year, according to a report given by County Finance Director Chris Huffman at the county commissioners’ June 18 meeting.
Huffman said the $15.07 million in sales tax the county received in that 10-month period of the fiscal year (July 1, 2018, to April 30, 2019) was $1.65 million more than the same months of the prior fiscal year.
He noted that $15.07 million is also 12.87% ($1.71 million) more than what was budgeted for fiscal 2018-19, which ends at the end of June. County officials don’t yet know the sales tax total for May.
Some of this fiscal year’s increase in sales tax revenue is due to retailers having to pay sales tax to the N.C. Department of Revenue on nearly all online sales in the state as of Nov. 1, but the extent of the impact isn’t known.
This change resulted from a U.S. Supreme Court decision (by 5-4) upholding a South Dakota law requiring all online retailers to collect a sales tax if they have more than $100,000 in annual sales or more than 200 transactions.
Before Nov. 1, companies didn’t have to collect retail sales tax in states where they didn’t have facilities because of a 1992 U.S. Supreme Court ruling that said online sellers had to collect it only in states where they had a “substantial presence.”
Current N.C. House and Senate budget proposals under discussion both close a remaining loophole in Internet sales tax collections by requiring that small out-of-state businesses using “marketplace facilitator” websites like eBay pays sales tax.
It’s now technically the responsibility of the North Carolina buyer to pay the sales tax on these transactions, but most don’t. Proponents of the legislation closing this loophole say it could generate $140 million in additional sales tax revenue statewide.
Sales tax rates in North Carolina range from 6.75% in most counties to 7.5% in Orange and Wake counties. It varies due to local option sales taxes. The sales tax rate in Wilkes is 7%.
A local option sales tax of one-quarter of one cent was approved in Wilkes in 2010 and resulted in $1.47 million of the current fiscal year’s total of $15.07 million by the end of April.
Sales tax revenue is distributed to county and municipal governments two months after it is collected. The totals Huffman shared don’t include sales tax revenue distributed to the governments of North Wilkesboro, Wilkesboro and Ronda.
The county collected $37.10 million in property taxes by the end of May, which was $1.33 million more than at the same time last year.
Huffman said that if county property tax collections this month are the same as in June 2018, the county will finish the year with property tax collections exceeding last year’s total.
The budget calls for collecting $37.57 million in property taxes in fiscal 2018-19, compared to $36.81 million the prior year.