Andal Announces 1999 Taxable Sales - First Quarter News Release - 2000

NR# 8-A
Date: February 11, 1999
Customer and Taxpayer Services Division

Andal Announces 1999 Taxable Sales - First Quarter

Dean Andal, Chairman, State Board of Equalization (BOE) announced today that taxable sales in California continued to grow at a healthy rate during the first quarter of 1999. Transactions subject to sales and use tax totaled $87.2 billion during the first quarter of 1999, an increase of $6.0 billion or 7.4 percent over the first quarter of 1998.

In constant dollar terms, taxable sales grew by 8.4 percent over the same quarter a year ago. The California Taxable Sales Deflator measured a negative inflation rate (deflation) of 0.9 percent for the first quarter of 1999. During this period, real growth in taxable sales actually exceeded current dollar growth as the average prices of taxable commodities declined.

Retail stores posted taxable sales of $56.2 billion, a 9.6 percent increase over the same period a year ago. Retailers of durable goods experienced a 13.4 percent increase, while nondurable goods retailers experienced a 6.0 percent increase.

In the durable goods category, new car dealers had another quarter of double-digit growth; the fifth in the last seven quarters. New car dealers posted taxable sales of $9.1 billion during the quarter, a 15.2 percent increase over the first quarter of last year. This follows the 9.6 percent increase shown in the fourth quarter of 1998. Retailers of building materials registered strong growth in sales as California's construction industry continued to perform well. Building material dealers posted taxable sales of $4.2 billion, up 20.5 percent from a year ago. Construction contractors had taxable transactions of $3.6 billion, an increase of 17.4 percent over the first quarter of 1998.

Gasoline consumption showed markedly little change, increasing to 3.4 billion gallons, an increase of only 1.4 percent from the first quarter 1998. The average price of gasoline during the first quarter was $1.128, a slight decline of 0.4 percent from the previous year's first quarter. Service station sales during the first quarter 1998 remained flat when compared with first quarter 1998, posting a modest 0.3 percent increase.

Most retailers of nondurable goods experienced moderate to strong increases in sales. Restaurants had sales of $7.6 billion, increasing 7.4 percent while general merchandise stores realized sales of $7.5 billion, an increase of 13.8 percent.

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