Thursday, October 13, 2011

Report Shows Income Taxes Lifting Oklahoma to Double-Digit Growth

General Revenue Fund Report Shows Income Taxes Lifting Oklahoma to Double-Digit Growth in First Quarter of Year
OKLAHOMA CITY — Oklahoma General Revenue Fund tax collections racked up 12.1 percent growth in the first quarter of the fiscal year, Office of State Finance Director Preston Doerflinger announced Monday as he released the GRF report for September.
Total collections, led by growth in income tax receipts, exceeded $1.3 billion for the three-month period.  That is $143.1 million, or 12.1 percent, more than last year and 7 percent more than expected.
For September, total collections were up by 14.5 percent from same month a year ago and topped the estimate upon which the Fiscal Year 2012 state budget was based by 6.3 percent.
"Our growth has been propelled by particularly strong income tax collections, reflecting hiring across many sectors, continued activity in the oil patch and an uptick in manufacturing jobs," Doerflinger said. "We also have seen steady growth in sales taxes. 
"This is in stark contrast with the national economy, which seems stuck at 9.1 percent unemployment, compared to Oklahoma's jobless rate of 5.6 percent in the latest report from the Oklahoma Employment Security Commission," he said.
"We've seen a dramatic jump in gross production taxes, compared with a year ago, because of the rise in drilling as oil and natural gas companies employ new technology to increase their production," Doerflinger said.
Gov. Mary Fallin said, "The latest revenue report brings us more great news and is further proof the Oklahoma economy is moving in the right direction. To carry this momentum forward, we must continue to pursue pro-growth, pro-business policies that create an environment that promotes further job growth and investment."
For the year, gross production taxes are up 36 percent, although natural gas prices dipped somewhat for several weeks, reducing the amount of anticipated revenues from that source.
Doerflinger, who is secretary of finance in Gov. Fallin's cabinet, said the loss in expected gross production revenue is being more than offset by income tax and sales tax growth.
Income and sales taxes are the biggest sources of revenue accruing to the GRF and the two tax areas economists generally look at most to gauge economic strength.
For September, combined corporate and personal income taxes totaled almost $257 million, which is up 8.4 percent over the same month a year ago, while exceeding the estimate by 11.3 percent. First-quarter income tax receipts are up 11.7 percent from last year and are 16.5 percent more than the estimate.
September sales tax collections increased by 7.4 percent from a year ago. Sales tax receipts were a fraction off the estimate in September. For the first quarter, they are up 7.3 percent from FY-2011, while topping the estimate by 1.2 percent.
Motor vehicle tax collections were down for September and for the first quarter.
Total collections to the GRF for the first quarter of FY-2012 were $1,323.7 million. This amount was $143.1 million and 12.1 percent above first quarter collections for FY-2011 and $87.9 million, or 7.1 percent, above the total estimate for the first quarter of FY-2012. 
Total collections for the GRF in September were $526.2 million. This amount was $66.5 million and 14.5 percent above collections for the same month in 2010 and $31.4 million or 6.3 percent above the monthly estimate for 2011.

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