Fort Smith sales tax revenue dips again in July report

The city of Fort Smith saw a sales tax revenue dip again in July. The city’s share of the Sebastian County sales tax was $2.048 million in July, down 5% from $2.156 million in July 2024, according to sales tax report posted by the city.

The July county tax share, which measures June transactions, was down 5.68% from $2.17 million forecast by the city.

The year-to-date countywide tax total for Fort Smith is $14.083 million, down 2.34% from the $14.421 million generated through July 2024. That tax brought in $24.49 million in 2024, 0.95% lower than 2023.

The city’s share of the countywide tax is important because the revenue provides money for the city’s general fund budget, with much of that budget paying for police, fire, and other essential city services.

Acting City Administrator Jeff Dingman said information received from the state indicates that the city’s retail sales of general merchandise and food seem to be holding steady with the same month the prior year. One significant difference is in sales of electrical equipment, which could be attributable to industry investment in the prior year that wasn’t repeated this year, Dingman said.

“Overall, the retail sales of general merchandise and groceries, which are by far the biggest segments of our sales and use tax generators, seem to be on par with the prior year. While we continue to monitor these revenues, nothing in these numbers shows cause for concern,” he said.

The 1% city sales tax generated $2.441 million in the July report, down 5.3% compared with the $2.577 million collected in the July 2024 report. For the first seven reporting months of 2025, the tax generated $16.997 million, down 2% compared with the $17.351 million in the same period of 2024.

Fort Smith voters in May approved a sales tax reallocation plan to provide $360 million over 30 years to fund federally-mandated sewer system work. The vote reallocated a 0.75% sales tax first approved by voters in 2022 to pay for consent decree work and to pay bonds, with 0.125% used for the Fort Smith Police Department. It also renewed the 1% street tax but reallocated 0.625% for streets, bridges and drainage work, with the remainder of the tax to fund consent decree work and bonds. And it approved the authorization to use the tax revenue to issue bonds to pay for the work.

PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 1% sales tax collection for streets
2024: $29.51 million
2023: $29.92 million
2022: $28.65 million
2021: $26.66 million
2020: $22.66 million
2019: $21.73 million
2018: $21.5 million

Fort Smith portion of 1% Sebastian County sales tax
2024: $24.49 million
2023: $24.64 million
2022: $23.55 million
2021: $21.49 million
2020: $18.24 million
2019: $17.26 million
2018: $17.04 million
2017: $16.69 million