The Party is Over in Arizona?

From a Joint Legislative Budget Committee Staff report prepared for the Arizona Legislature on February 29, 2008.

• Total January General Fund revenue collections were $849.3 million, or (16.1)% below January of last year. The January decrease represents the largest percentage year over year decline since April 2002. The dramatic drop in January revenues was across the board in all 3 main revenue categories...
  
• Sales Tax collections were $406.9 million in January. This amount was down (7.5)% compared to last January... This is the largest percentage year over year decrease since at least FY 1991.
• There were significant variations in January [Sales Tax] collections by sector. Retail and contracting collections together account for two-thirds of all sales tax revenues. The retail sector declined by (3.8)% and contracting by (24.1)%. The restaurant and bar category also decreased by (11.3)%. The only positive growth in the major categories was in use tax, which increased 5.7%.
• Individual Income Tax collections were $479.6 million, or (11.9)% below last year. January withholding was (4.9)% below last year.

Tax receipts are directly proportional to the gross amount of whatever is being taxed. So this big decline in all forms of tax revenue means a big decline in economic activity.

Note that retail sector collections for January were down drastically despite the Super Bowl being held in AZ.