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Mardi Gras and Sales Tax?

  • Feb 12, 2013 | Gail Cole

 New Orleans Mardi Gras: Are You Having Fun Yet?

Sales tax is probably not the first thing that jumps to mind when you think of Mardi Gras and New Orleans, Louisiana. Outrageous parades, outrageous parties, amazing food,  abundant drink, … but not sales tax. Yet if Mardi Gras is integral to the culture of the city, it is also integral to its economy. Sales tax is part of the reason why.

In January 2012, neworleansonline.com released a study on the economic impact of Mardi Gras. The study revealed that Mardi Gras 2011 contributed "nearly $8.50 in tax revenues for every $1 the city spent in direct services support like police, fire and sanitation." Meaning that "every tax dollar generated as a result of Mardi Gras generates a greater return on the City's investment."

Data for the study was "limited to actual expenditures obtained from out of town hotel visitors, local citizens, carnival crew officials, crew members and city government." Mardi Gras 2011 brought approximately $300.7 million to New Orleans; and 2011 was a slightly off year, thanks the nation's economic downturn.

A Tulane University study on the economic impact of Mardi Gras 2011 estimated that "$2,494,386 in grocery store sales excluding alcoholic beverages can be directly associated with Mardi Gras." Sales of alcoholic beverages were estimated to increase 30% during Mardi Gras.

Rain is expected to accompany the parades today, but does that dampen spirits? No indeed. "If it rains, put a hat on," says Frank Warford of Riverdale, Georgia. "I'll party if it's freaking thundering, " says Katiey Diamond of Sayreville, New Jersey.

So parties will be thrown, groceries and trinkets will be purchased, food and drinks consumed. Most purchases contribute sales tax revenue to the city, which has a combined state and local rate of 9.0%. That makes a very fat Tuesday.

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photo credit: evita2005 via photopin cc

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.