Spokane’s sales tax revenue declines $ 4.1 million last year; fifth largest decline in Washington | Washington
(The Center Square) – The city of Spokane saw the fifth largest drop in sales tax revenue among Washington communities last year after a new one report from the Washington State Auditor’s office.
Spokane’s sales tax collection decreased more than $ 4.1 million from a year earlier, from $ 63.7 million to $ 59.6 million; a decrease of 6.4%.
Washington’s total sales tax collection fell 4.5% last year, a decrease of $ 76.7 million. However, the auditor reported that “167 out of 272 cities (that’s over 60%) saw their sales tax collections increase over the 2019 pre-pandemic.”
“We believe every city has its own story that explains its rise or fall,” the report said. “We shouldn’t assume that one factor is responsible for change.”
While Spokane’s sales tax collections were in decline, the percentage change was only marginally worse than the national average.
Spokane is the second largest city in the state according to the city website Washington demographics. However, Washington’s fifth largest city, Bellevue, saw a decline from last year’s collections of more than $ 19 million, dwarfing Spokane’s decline.
Brian Coddington, communications director for the city of Spokane, said some of the economic boom could be attributed to planning.
“The city has worked closely with business and public health to develop some COVID-safe marketing and business support strategies to encourage and remind people to visit their favorite local roadside stores as well,” he said. “Some weeks of night markets and other marketing partnership efforts have helped keep the business going to some extent.”
Still, Coddington sees a difficult economic path ahead of him.
“Spokane’s economic base is heavily dependent on the retail and hospitality industries, which have been hardest hit by the pandemic, especially in the first year,” he said. “The events are just coming back and the conference business is still just a skeleton in itself.”
Lance Beck, president of the Greater Spokane Valley Chamber of Commerce, which represents the Spokane suburbs, agreed with Coddington on the impact of COVID-19 on downtown Spokane.
“We saw the downtown area close,” said Beck. “The skyscrapers were empty and it was incredibly quiet.”
Beck believes that many of Washington’s cities’ problems with VAT collection last year stemmed from “centralized employment but non-resident workers.” When large numbers of workers coming from outside a city were prevented from doing so, they preferred to stay at home and spend the money locally instead.
In Spokane, large numbers of people live in the same city where they work, Beck said. When the city center was closed, even more people worked and spent locally than in many other metropolitan areas.
However, some people who had commuted to Spokane still had to stay at home.
“We saw a bonus” in Spokane Valley “because people were working from home,” Beck said.
Beck cited the small town of Liberty Lake in Spokane County as an example. While sales tax levies in Spokane fell 6.4%, things boomed in Liberty Lake, where levies increased 20.5%.