CARSON CITY, Nev. (AP) - Nevada merchants had a tough year in fiscal 2008 with sales totaling $48.2 billion for a decline of 2.5 percent compared with the prior year, the state Taxation Department reported Wednesday.

The 2008 sales generated $3.9 billion in sales taxes statewide, down 3.7 percent from the previous fiscal year, the agency reported.

The state's 2 percent share of the sales taxes totaled $966.6 million - a 3.4 percent decrease from the year before. The rest was divided among school districts, county and local governments. While down, the state's cut was $1.9 million higher than an Economic Forum projection made in June.

Gov. Jim Gibbons said the decline in sales was expected. He added the construction industry remains strong thanks to major projects in the Las Vegas area although consumer spending faltered in June as the fiscal year closed.

A breakdown shows that in June merchants sold $4.2 billion in goods, down 6 percent compared with the same month a year earlier. Thirteen of the state's 17 counties - including the two largest, Clark and Washoe - were down compared with June 2007 sales. For the full year, 12 counties, including Washoe and Clark, had declines compared with their totals in the previous year.

Sales in Clark totaled $3.13 billion in June, down 3.3 percent; and $35.9 billion for the fiscal year, down 0.9 percent.

Sales in Washoe amounted to $585.4 million in June, down 13.7 percent; and $6.8 billion for the year, down 5.3 percent.

The Taxation Department report shows that vehicle and auto part sales were down 16.1 percent in June, and down 11.5 percent for the year; while building material sales were down 13.4 percent in June and down 16.5 percent for the year.

Restaurant-bar sales were down 12.3 percent in June and down 4.7
percent over the fiscal year. Such sales, totaling $7.2 billion for the year, are considered good indicators of tourist traffic in Nevada.

Clothing store sales were up 4 percent in June and up 6.4 percent over the year; while general merchandise sales were down 3.4 percent in June and down 2.8 percent over the year.

(Copyright 2008 by The Associated Press. All Rights Reserved.)