Retail Tax Report Shows Mixed 2024 Results in Central Virginia
As a part of its mission to inform the public of business activity, the Charlottesville Regional Chamber of Commerce today released the 2024 Retail Report.
The report indicates 2024 retail and internet sales growth in six of the seven Central Virginia localities tracked by the Charlottesville Regional Chamber of Commerce.
In total, the localities studied collected over $1,809,883 (2.59%) more in retail sales tax in 2024 compared to 2023. Albemarle County saw the largest percentage increase (7.57%) followed by Greene County (4.9%).
Augusta, Fluvanna, Louisa, and Waynesboro all showed growth, but that growth did not keep up with inflation. Charlottesville sales tax collection was the only negative result (-3.4%) compared to 2023 sales.
“Following years of robust growth, City based sales tax revenue appears to be entering a period of contraction,” said Chris Engel, Director of Economic Development for the City of Charlottesville. “While there are numerous contributing factors to this change, the most significant appears to be limited opportunity for new retail development within our small geographic footprint. The City is actively monitoring this trend and incorporating relevant data into current and future budgeting scenarios.”
“Local sales tax revenue is one of several data points in measuring consumer spending and confidence among our community,” said Albemarle County Director of Economic Development Emily Kilroy. “The strong year over year growth in Albemarle is a good local indicator to compare against national trends that show more modest consumer spending over the same period. With new retail development expected to open this year, we are eager to see how this changes in the coming months and how we can continue to be a partner in a vibrant local economy.”
The 2024 Retail Report data is based on the Virginia Department of Taxation’s Local Option Sales Tax Data. The report is a trailing indicator, measuring past data to yield insight on the outcomes of past decisions and events. This analysis is not intended to predict future trends.
According to the University of Virginia’s Weldon Cooper Center for Public Service’s Center for Economic Policy Studies:
“Any city and county may levy a general retail sales tax at the rate of one percent to provide revenue for the locality’s general fund. All local sales tax moneys collected by the localities are paid into a state treasury special fund. The State collects and distributes this Local Option one percent Sales and Use Tax, as provided under the Code of Virginia §58.1-605 and §58.1-606. Actual distributions are made monthly to every county and city based on the locality in which the tax was collected. The amounts are recorded in the Local Option Sales Tax report.”
In general, all sales, leases, and rentals of tangible personal property in or for use in Virginia, as well as accommodations and certain taxable services, are subject to Virginia sales and use tax, unless an exemption or exception is established. Fuel and automobile sales are not included in the local sales tax option. The local “option” is a bit of a misnomer as the State has mandated its collection at a minimum of 1% for all localities in the state (Hampton Roads, Northern Virginia, and Historic Triangle have additional sales tax).