I think the answer is both are lying/cheating.

Many purchases of personal items are not taxable. Food and in many states clothing.

Still not enough to account for this difference though.

A shift into more food (non-taxable, not including prepared at restaurants, which IS taxable) is extremely bearish for the economy, since that is typically non-discretionary.

Give the spin doctors a break. With all the spew and bull****, it is hard work to get their stories straight.

I thought about food too but then I don't know many people who are doing what we're doing. Even my kids are in denial and think I'm nuts. So, good ole dad has to buy more so they can eat when SHTF.

Didn't I hear that many would be surprised to find they would be paying taxes on clash for clunkers?

If those taxes are not due yet, wouldn't that account for some of the discrepancy?

The taxable sales numbers here in Nevada are dreadful, and where I am, the City of Las Vegas as well as Clark County depend on that revenue. Somewhere on this forum, either I or someone else posted the August 2009 numbers and ther were down something like 26%. Now if that was versus August 2008, it's even more brutal as things were already headed south at that time.

Or how about actual observed evidence today 11/23/09? Target store. Boca Park mall here in Las Vegas. In one of the top 5 zip codes in Clark County. Three registers open. That was it. And, I did not see shopping carts full of goods.

Can't wait till April 15,2010. If they can't pay the mortgage, how they gonna pay taxes on their wages or UI?

I see the PCE is derived from something called the "Survey of Current Business". I would like to emphasize the word "current." Isn't this yet another case of the government ignoring the sales figures from stores that go out of business, thereby putting an upward bias in the numbers?

I just had another thought: If the government measures everything this way, only using data from "current businesses" and then extrapolating from there, could even the sacred GDP statistics be in question?!?!?

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Many purchases of personal items are not taxable. Food and in many states clothing.

Here in KY grocery store food (home consumption) is tax exempt

Clothing?

Up to $110 on some clothing here in NY. That's for NYS. Local Sales tax by most towns and cities are colected though.

Just a little FYI. I talked with someone in the replacement window industry yesterday. He's senior management and he told me that millions of people have taken advantage of the $1500.00 energy tax credit. The industry has sold a lot of windows this year and a lot of furnaces have been sold too, using the tax credit.

He believes that the federal government will shut down the program when they see what it does to their tax collections next year. He thinks the Treasury is in for a nasty surprise and this tax credit will crush their tax receipts leaving the government in an even deeper hole.

KD you need to compare YoY numbers. Here is the PCE series detail:
http://www.bea.gov/national/nipaweb/Tabl....

Goods consumption is down big due to gasoline, but services are up, almost all the increase from health care.

Are services taxable in the US, or just goods? If it's mostly goods it would explain the discrepancy.

PCE is grossly overstated, but tax receipts are understated. There is no sales tax on internet purchases.

Amazon.com Announces Third Quarter Sales up 28% to $5.45 Billion

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There is no sales tax on internet purchases.

Not necessarily so

Speaking of numbers that don't jive...

Apparantly the debt clock is showing we will pay off the deficit in about 3.5 years.

http://www.zerohedge.com/article/whither....

All I know is my spending is only at consignment shops and thrift stores. Purchased food at restaurants only 3 times in the last 30 days, and grocery purchases are mainly sale items (buy one get one free). So, my purchases would not generate much sales tax revenue.

My friends are doing the same. We are all trying to save as much as we can.

For the last few months every time I go to the Super Walmart to buy groceries no one that I notice is ever buying anything but food and our food in SC is not taxed. And I have noticed lately the food purchases are quite large. I think the sheeple our waking up.

sorry are

Not only are we running on fumes from the housing boom now bust we are relying on appearance. We need more advertising, maybe some clever ads for the Chinese to convince them we are going to be maxing our credit cards out at Wally Mart for X-Mas so they keep buying our bonds

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All I know is my spending is only at consignment shops and thrift stores. Purchased food at restaurants only 3 times in the last 30 days, and grocery purchases are mainly sale items (buy one get one free). So, my purchases would not generate much sales tax revenue.

Mrs. Clock shops like that too.

I don't shop much at all; so I can't figure who's telling the truth about personal spending.

Those Pennsylvania numbers are a disaster based on the cobbled together budget that it took them 3 1/2 months past the beginning of the fiscal year to pass.

...and Ohio - a decrease in Corporate Income Tax of 111%!?!?! BWAHAHAHAHA!

Looks like Corporate NOL Carrybacks forcing refunds of good taxes collected and spent by State government in prior years being 'clawed-back' by companies...oops! - just like the Feds got a Negative $4.5B in Corporate tax receipts in October. I bet *that* wasn't in anyones Budget!

I noted the same inconsistancy in my local paper the last few days. ON Thursday, I believe, they featured a story on how state payroll tax revenue was in the toilet then, on Friday, they featured a story on how the state unemployment (U-3) had declined. Of course more people could be working for lower wages and fewer hours but I doubt it.

Be interesting to run the PCE numbers vs. sales tax revenue back a few years and see if the inconsistancy is chronic or just developing.

If people were buying more then wouldn't there be more products being transported (even if it were tax-free food)? Rail traffic continues to decrease significantly from last year's numbers and has all year.

http://railfax.transmatch.com/

Also, sales taxes went up in several areas this year - California's sales tax went up 1% starting in April '09, which means that the drop in 8.2% from last year is much worse than at first look.

And just about every earnings report I read this year shows dramatic declines in sales from last year's numbers. The spin coming out of the Government are laughable anymore they are so unbelievable.