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Local Sales Tax Revenue Sees 'Robust' Increase


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By Jorge Casuso

October 6, 2022 -- The auto industry is driving Santa Monica's economic recovery, accounting for 16 of the city's 27 top sales tax generators, according to the latest financial data from the City.

The recently released sales tax report for the first quarter of 2022 shows a 27 percent rise in tax revenues over the first quarter of 2021, according to a report released Thursday.

The increase was also driven by an 89 percent jump in sales taxes generated by hotels and restaurants, which along with auto dealers account for half of the city's sales tax revenues.

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"The robust increases across multiple sectors like travel, tourism, and hospitality provide continued evidence that the City of Santa Monica continues to advance our recovery," said the City's Economic Development manager, Jennifer Taylor.

Major gains in sales tax revenue were made by three sectors that saw business skyrocket over the first quarter of 2021, the data show.

Casual dining jumped 81.9 percent in the first quarter of this year, fine dining by 128 percent and hotels/motels by 367.3 percent over the same three months in 2021, when the travel industry was crippled by the coronavirus emergency.

The Fairmont Miramar Hotel topped the list of hotels/motels, ranking fifth in sales taxes, followed by Shutters on the Beach, which ranked nineteenth.

Apple produced the most sales taxes of any business, while four home improvement stores -- Bourget Brothers, Michael Smith Design, Ferguson Enterprises and Snyder Diamond -- were among the top tax generators.

So were Daimler Trust, JP Morgan Chase Bank and Ring, the Santa Monica-based home security and smart home company owned by Amazon.

After hotels and restaurants, the sector generating the third highest sales tax revenue was the State and LA County Pools, which produced 19 percent of the total, primarily from online shopping.

The sector saw a 20 percent hike in sales tax revenues in the first quarter year to year, according to the report.

While online sales outstripped those at brick and mortar businesses, they generated far less revenue, officials said.

That's because the tax revenues go into a countywide tax pool that disburses only 2 cents of every dollar of tax to the city, compared to 20 cents for sales generated at brick and mortar retail.

Half of the sales tax revenue from brick and mortar businesses "goes back to the City and half of that is specifically re-invested into the community by funding schools and affordable housing in Santa Monica," Taylor said.

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