Despite Inflation Concerns, HdL Companies Reports Continued Growth for California Sales Tax Returns in 3Q2022
BREA, Calif.--(BUSINESS WIRE)--Jan 12, 2023--
The Golden State showed moderate gains in sales tax receipts in the third quarter of 2022, reporting an overall 8% increase in sales and use tax from July through September, compared to the same period in 2021. The returns reflect another period of solid growth for California’s economy.
“As the Federal Reserve Board continued ramping up interest rates in an effort to curb concerns over inflation, consumers continued purchasing a broad array of goods, especially new automobiles,” stated HdL Companies President/CEO Andy Nickerson. HdL is the leading provider of revenue enhancement technology and consulting services for local governments. Each quarter, it reports on California’s sales tax receipts and impacts on local jurisdictions.
The automobile sector saw growth of 6% with new car dealers experiencing 10% gains compared to 2021. Limited inventory and demand for higher mileage vehicles, including electric and hybrid models, supported the growth. “Increased costs for used cars have diverted consumers into the new car market, continuing the vehicle industry boom that started during the pandemic. Meanwhile, recreation vehicle sales and auto leasing remained soft,” Nickerson commented.
For Californians, the summer of 2022 made for the highest gas prices on record, lifting fuel and service station receipts by 21%. Commuters and summer travel remained steady while overall fuel consumption trails pre-pandemic levels by approximately 13%. For the second straight quarter, fuel sales linked to discount department stores propped up general consumer goods results. Otherwise, retailers experienced flat to decreased sales as many apparel categories, home furnishings, and sporting goods struggled to keep pace with the prior year.
“The restaurant and hotel sector experienced an uptick of 10% due to increased menu prices, a sustained thirst for dining out and strong tourism,” noted Nickerson. Theme parks, leisure-entertainment venues, and hotels showed positive momentum, guiding the sector back to 2019 levels.
Contractors and plumbing-electrical suppliers boosted the building and construction sector to gains of 8% with solid residential and commercial housing prices persisting despite interest rate hikes. Tenant improvements also supported further spending activity for this segment.
“Sustained price increases and interest rate hikes have consumers contemplating where to spend their dollars but historically low statewide unemployment rates and the recovery of the national stock markets from recent declines leave modest optimism heading into 2023,” concluded Nickerson.
View a complete table of sector and regional data here.
About HdL Companies
HdL Companies is dedicated to supporting local governments across the U.S. with revenue enhancement, technology and consulting services that enable cities, counties and special districts to better serve their constituents. Founded in 1983, HdL Companies’ comprehensive approach to revenue management is trusted by over 600 local governments. The company has successfully recovered over $3 billion in revenue for client agencies. For more information, visit hdlcompanies.com.
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Jennifer Pierce, HdL Companies, 714.879.5000
KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA
INDUSTRY KEYWORD: PUBLIC POLICY/GOVERNMENT STATE/LOCAL FINANCE CONSULTING ACCOUNTING PROFESSIONAL SERVICES SUPPLY CHAIN MANAGEMENT RETAIL
SOURCE: HdL Companies
Copyright Business Wire 2023.
PUB: 01/12/2023 04:30 PM/DISC: 01/12/2023 04:31 PM