North Dakota Lost Nearly $2 Billion In Taxable Sales During Third Quarter Of 2015
“Taxable sales and purchases were $5.763 billion for July, August and September of 2015, a drop of nearly 25 percent over those months in 2014,” the press release from North Dakota Tax Commissioner Ryan Rauschenberger’s office states.
That’s ugly, though Rauschenberger puts a positive spin on the numbers by pointing out that we’re still up significantly from the third quarter of 2010. “Although taxable sales and purchases for the third quarter are down when compared with 2014, viewing it with a longer-term perspective still shows an increase,” he said in the release. “Taxable sales and purchases for the third quarter have increased more than 31 percent since 2010.”
This is the trend he’s talking about:
That’s all well and good, I suppose, but keep in mind that the general fund budget these taxable sales are (in part) supporting has increased 108 percent from the 2009-2011 biennium through the 2013-2015 biennium. The general fund budget for the 2015-2017 biennium is over $7.2 billion (a 119 percent increase since 2009-2011) and was built on a revenue forecast which predicted over $163 million more in revenues through November than the state actually collected.
So while we can say that taxable sales are still up significantly from where they were in 2010, the amount of state spending the sales tax (and the income taxes, etc., etc.) must support is up significantly more.
That’s why it’s so frustrating when the state’s budget officials downplay the impact of the oil slowdown on state revenues, something I wrote about the other day. Sheila Peterson, director of the Fiscal Management Division of North Dakota’s Office of Management and Budget, told a Fox News reporter that direct oil tax revenues into the general fund are capped at $300 million and that even with the oil slowdown the state still expects to get that $300 million in direct revenue.
Which is accurate, sure, but also misleading as these sales tax figures show. The impact of slowed oil activity has been profound.