HdL Sales Tax Report for CY2020 Q3 Saleswww.hdlcompanies.com | 888.861.0220
Q3 2019*
Q3 2020*
Legend
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
SALES TAX BY MAJOR BUSINESS GROUP*Allocation aberrations have been adjusted to reflect sales activity
County
and State
Pools
General
Consumer
Goods
Restaurants
and
Hotels
Autos
and
Transportation
Food
and
Drugs
Building
and
Construction
Fuel and
Service
Stations
Business
and
Industry
TOP 25 PRODUCERSCITY OF ENCINITAS HIGHLIGHTS
Published by HdL Companies in Winter 2021
SALES TAX UPDATE
CITY OF ENCINITAS
3Q 2020 (JULY - SEPTEMBER)
7 Eleven
76
Best Buy
BMW of Encinitas
Cardiff Seaside Market
Dick’s Sporting Goods
Encinitas Ford
Financial Services Vehicle Trust
Hansen Surfboards
Herman Cook Volkswagen
Home Depot
Home Goods
Pacific Coast Grill
Quick Shine Car Wash
RCP Block & Brick
REI
Shell
Shell Car Wash At Encinitas Ranch
Target
TJ Maxx
Trader Joes
Valero
Vons
Vuori
Walmart Supercenter
Encinitas’ receipts from July through
September were 11.8% above the third
sales period in 2019. Excluding reporting
aberrations, actual sales were up 8.1%.
However, deferred tax payments from
last quarter temporarily exaggerated
the cash results. Once these and other
reporting aberrations are excluded,
actual sales were up 8.1%.
This was the second full quarter impacted
by the pandemic, with local point of sale
receipts down 3.9% compared to the
prior year. Restaurants saw significant
declines, with casual dining down 26.5%.
Many eateries were closed or only able to
provide limited services as a result of the
pandemic shutdowns. Fuel and service
station receipts also were depressed as
the cost of gas and overall consumption
remains low.
As an offset, increases in the building and
construction group, as well as the food
and drug and autos and transportation
groups.
The City’s share of the countywide
use tax pool allocations jumped 79.9%
over the prior year period. This gain
was boosted by a combination of new
taxes on out-of-state purchases from
full implementation of AB147 (Wayfair),
and surges in online spending tied to
the pandemic crisis and use of federal
stimulus funds by households.
Net of aberrations, taxable sales for all
of San Diego County declined 1.3%
over the comparable time period; the
Southern California region was down
1.5%.
TOTAL:$ 3,778,168
8.1%-1.3%-0.9%
COUNTY STATE
ENCINITAS
3Q2020
Q3 '20*
EncinitasBusiness Type Change Change ChangeCountyHdL State
-37.9%-34.2%-26.5% 232.3 Casual Dining
-29.0%-31.2%-30.4% 231.4 Service Stations
7.1%8.1%8.8% 173.8 Grocery Stores
-10.3%-12.4%-10.2% 158.0 Quick-Service Restaurants
22.0%25.4%19.3% 152.8 Sporting Goods/Bike Stores
-3.5%-4.4%1.3% 107.3 Home Furnishings
15.0%19.5%33.9% 96.0 Convenience Stores/Liquor
-14.2%-16.4%-18.0% 94.8 Fast-Casual Restaurants
-5.4%-3.2%-2.4% 72.9 Auto Lease
-21.1%-20.8%-19.4% 70.6 Electronics/Appliance Stores
*Allocation aberrations have been adjusted to reflect sales activity *In thousands of dollars
REVENUE BY BUSINESS GROUP
Encinitas This Quarter*
24%
Pools
14%
Restaurants
13%
Autos/Trans.
8%
Building
4%
Bus./Ind.
24%
Cons.Goods
8%
Food/Drug
6%
Fuel
*ADJUSTED FORECONOMIC DATA
SALES TAX UPDATECITY OF ENCINITAS
TOP NON-CONFIDENTIAL BUSINESS TYPES
3Q 2020
STATEWIDE RESULTS
The local one-cent sales and use tax
from sales occurring July through
September was 0.9% lower than
the same quarter one year ago after
factoring for accounting anomalies.
The losses were primarily concentrated
in coastal regions and communities
popular with tourists while much of
inland California including the San
Joaquin Valley, Sacramento region and
Inland Empire exhibited gains.
Generally, declining receipts from
fuel sales, brick and mortar retail
and restaurants were the primary
factors leading to this quarter’s overall
decrease. The losses were largely offset
by a continuing acceleration in online
shopping that produced huge gains in the
county use tax pools where tax revenues
from purchases shipped from out-of-
state are allocated and in revenues
allocated to jurisdictions with in-state
fulfillment centers and order desks.
Additional gains came from a generally
solid quarter for autos, RV’s, food-drugs,
sporting goods, discount warehouses,
building material suppliers and home
improvement purchases. Some
categories of agricultural and medical
supplies/equipment also did well.
Although the slight decline in
comparable third quarter receipts
reflected a significant recovery from
the immediate previous period’s deep
decline, new coronavirus surges and
reinstated restrictions from 2020’s
Thanksgiving and Christmas gatherings
compounded by smaller federal stimulus
programs suggest more significant
drops in forthcoming revenues from
December through March sales.
Additionally, the past few quarter’s
gains in county pool receipts that were
generated by the shift to online shopping
plus last year’s implementation of the
Wayfair v. South Dakota Supreme Court
decision will level out after the first
quarter of 2021.
Much of the initial demand for computers
and equipment to accommodate home
schooling and remote workplaces has
been satisfied. Manufacturers are also
reporting that absenteeism, sanitation
protocols, inventory and imported parts
shortages have reduced production
capacity that will not be regained until
mass vaccines have been completed,
probably by the fall of 2021.
Significant recovery is not anticipated
until 2021-22 with full recovery
dependent on the specific character and
make up of each jurisdiction’s tax base.
Part of the recovery will be a shift back
to non-taxable services and activities.
Limited to access because of pandemic
restrictions, consumers spent 72% less
on services during the third quarter and
used the savings to buy taxable goods.
Full recovery may also look different
than before the pandemic. Recent
surveys find that 3 out of 4 consumers
have discovered new online alternatives
and half expect to continue these
habits which suggests that the part of
the recent shift of revenues allocated
through countywide use tax pools and
industrial distribution centers rather
than stores will become permanent.