Retailers Ask For BP To Pay For Local Sales Tax Holidays

December 15, 2010

Florida retailers on Tuesday said they are asking BP to spend $25 million to reimburse the state for a series of sales tax holidays beginning in February to help lure shoppers to the local Northwest Florida area that took a $454 million hit following the Deepwater Horizon oil spill.

Citing a Florida TaxWatch study on lost retail revenue, Florida Retail Federation president and CEO Rick McAllister said the group is negotiating with BP to pay for three-day sales tax holidays beginning in February to help the lure tourists back to the five-county region after many canceled travel plans last summer because of the spill.

“This is not about claims for losses,” McAllister said. “This is about how we move forward. How do we return Northwest Florida to where it needs to be?”

McAllister said he expects to announce a deal within the next few weeks. The tentative proposal calls for a state sales tax holiday to run once a month between February and August. The proposal would limit the tax-free status to items under $200. BP would pay the sales tax that would have been levied. Marketing campaigns and incentives would piggyback on promotional programs coordinated through the lodging and tourism efforts. The holidays would run Friday through Sunday in Bay, Escambia, Okaloosa, Santa Rosa and Walton counties.

McAllister said Tuesday the holidays could be put in place without having to ask the Legislature for approval as long as the taxes were paid on time to the Department of Revenue. Agency spokesman Rene Watters said Tuesday that the details of the proposal were still being reviewed.

A study by Florida TaxWatch estimated retailers in a five county region — including Escambia and Santa Rosa — saw sales fall $454 million between May and September, including $239 million in taxable sales. The downturn translates into $14.3 million in lost state sales tax revenue and another $1.1 million in local tax collections.

Prior to the spill, the region was experiencing year-to-year revenue gains that outpaced the statewide average, a trend that reversed itself following the April 20 explosion and fire aboard the Deepwater Horizon rig. Tourism related taxable sales over the critical summer period fell 7.1 percent n the region compared to a 2.8 percent gain statewide.

“June 2010 broke a streak of 17 consecutive months where Northwest Florida was doing better than the state as a whole,” said Kurt Wenner, TaxWatch vice president for tax research. “Then all of a sudden, it fell off the table. ”

Laurie Olshefsky, who with her husband owns four Panhandle businesses, said the summer sales were off by 30 percent, a considerable drop after seeing double digit growth leading up to the spill. Like other retailers in the region, she relies on the summer tourism season for a large portion of her annual sales.

“When the oil spill hit, people stopped coming and they went other places where they were guaranteed to have a good time with their families.”Olshefsky said. “We were blessed that we were not hit by the oil spill, but we were damaged financially. ”

Retailers are worried tourists who cancelled plans to visit the Panhandle last summer and went elsewhere, will not return this summer. Other summer destinations benefited by the bad publicity that cast a shroud over the entire gulf region and prompted financially pinched tourists to look elsewhere for summer fun.

“What keeps me awake at night in regard to Northwest Florida is all those people who went to Myrtle Beach last year instead of going to Destin or Panama City Beach or Pensacola. Did they find something there that they enjoyed so they are going to try it one more year?” McAllister said.

By Michael Peltier, The News Service Florida

Pictured top: Kurt Wenner, president of tax research for Florida TaxWatch, briefs reporters on the freefall of retail sales in the Florida Panhandle. Florida Retail Federal President Rick McAllister (left) said the organization has asked BP to pay for series of sales tax holidays to boost sales in the region. Photo by Michael Peltier for NorthEscambia.com, click to enlarge.

Comments

5 Responses to “Retailers Ask For BP To Pay For Local Sales Tax Holidays”

  1. whitepunknotondope on December 16th, 2010 3:18 pm

    “And if you lookit this nice poster we had made up by a gin-you-wine graphic artist, you can see the yucky oil dribbling down from the surface (though it was actually spewing up from the bottom TOWARDS the surface) and you can see that these here numbers which are this big circle here represent something IMPORTANT!”

  2. David Huie Green on December 15th, 2010 9:02 pm

    and I want BP to give me a billion dollars–for starters, not because I deserve it or was harmed by it, just because I want it.

  3. Lets Drill on December 15th, 2010 7:48 am

    You want to move forward, then lets drill. The lost money is not because of the oil spill, it is the cost of going to the beach here. If we drill then there will be a steady flow of people through this area going to and from work. This will be a year long source of income for the area, not just during the summer months. There will be a number of jobs created for this area as well. People need to look at other things than just the beaches.

  4. Marty on December 15th, 2010 7:23 am

    “What keeps me awake at night in regard to Northwest Florida is all those people who went to Myrtle Beach last year instead of going to Destin or Panama City Beach or Pensacola. Did they find something there that they enjoyed so they are going to try it one more year?” McAllister said.
    SOOOOO if they found something they like better than your goods this is BP’s fault……give me a break…..sooo tired of the whining…If it is not BP someone is blaming Bush.Get on with life it is what it is

  5. A Fan of EWMS on December 15th, 2010 7:10 am

    Sounds like a good idea to me! I like the part about moving forward. . . let’s get this area growing again!

    And it gives us something to look forward to after all the Christmas sales are gone! ;-)

Written by William Reynolds · Filed Under News