Sales tax income down again

Customers buying taxable goods in Erie County in January created about $1.24 million in local sales tax income
Andy Ouriel
Apr 24, 2014
It’s hard to find something lower than this past January’s frigid temperatures.

But just look to Erie County’s sales tax income, and you’ll see how once again actual collections fell below budgeted projections.

Customers buying taxable goods in Erie County in January created about $1.24 million in local sales tax income.

The numbers for January were finalized this month. It typically takes three months for officials to calculate a particular month’s actual sales tax amount.

The latest collection continues a disturbing trend for sales tax figures.

For four consecutive months now — dating back to January, which reflects October numbers — actual collections have fallen short of the budgeted amount.

Constant shortfalls in month-over-month sales tax figures have translated into about a $320,000 overall shortfall thus far in 2014, when analyzing finalized numbers for January, February, March and April.

“The sales tax receipts in the past four months have unfortunately reflected the sluggish U.S. economy,” Erie County commissioner Bill Monaghan said. “The figures have not reflected our estimates of receipts”

Monaghan said the shortfall right now isn’t enough for commissioners to even begin considering service reductions.

Sales tax money represents about half of Erie County’s annual income injected into the $27 million everyday operating budget. The money funds many public services, including court, sheriff and maintenance operations.

2014 Erie County sales tax income
•Actual collection to date: $5.95 million
•Budgeted # amount to date: $6.27 million
•Up or down projection: Down about $320,000
•Year-end goal: $22 million

Source: Erie County finance department

2014 tax outlook 
Erie County will collect a sizable amount of sales tax money this year. Beginning this past October, shoppers buying taxable goods in Erie County paid a higher tax rate.

In July, county commissioners voted to temporarily raisethe sales tax rate for one year. The increase is expected to generate an extra $7.2 million in 2014 for a yearly total of about $22 million in sales tax money. The additional $7.2 million is strictly earmarked to fund infrastructure improvements. The state’s portion of the sales tax also increased at the same time the county’s temporary tax spike kicked in.

Here’s a breakdown of the past, present and future tax outlook in Erie County:
•6.5 percent: Tax rate prior to October, with 5.5 percent going to the state and 1 percent going to Erie County.
•7.25 percent: Tax rate from Oct. 1, 2013, to Oct. 1, 2014, with 5.75 percent going to state and 1.5 percent going to Erie County.
•6.75 percent: Tax rate from Oct. 1, 2014 going forward, with 5.75 percent going to state and 1 percent going to Erie County.

  

Comments

goofus

Oh no, how are the leftist going to defend Obozo's economy now
'

local man

Would be nice to know what the 2013 actual collection was for the same 3 month period - budgeted numbers don't really mean anything

rottnrog

As cold as it was I know I wasn't out spending as much $$$ as usual.

Nothing to do with politics goofy !!!

Perkins Resident

Myself and many others I know are spending our dollars in others Counties. Raise the tax and the dollars will go elsewhere. Monaghan is clueless.

2cents

I have friends that would come from Cleveland to make purchases in Erie county when it was worth the drive and fuel. They no longer do this, I posted when the tax was presented that it would happen.

Babo

One way for Erie County to increase sales tax collections is for commissioners to support the proposal by Governor Kasich to reduce the state sales tax rate from 5.75% to 5% by adding additional services or products to which the sales tax will apply. For example legal services and admissions to amusement parks are not presently subject to sales tax but could be subject to sales tax.

Just imagine if the county received 1 to 1.5% of Murray and Murray and other law firms as well as Cedar Point's sales. It would likely total several million dollars a year.

The Big Dog's back

How about 10% on all stock trades?

Babo

Not a bad idea. : )

Nemesis

And you try to call yourself a capitalist. Your freudian slip is showing, Che.

BIGHAWK

What does Erie county do for city and township economic development, ERIE COUNTY=CASH COW's spend spend spend, plus almost 8/thousand of real estate value. Sales tax dollars are going to wrong entity should be city and township not county.

Greengiant

Now you know the spending goes on at the county no matter the weather. I think King Pat and Prince Bill should just round off the tax to 8% and everything would just be peachy.......

Ralph J.

When does Erie County get their cut of the profits from the Kelleys Island Ferry?

ohioengineer

The sales tax is the most regressive (hits the poor the hardest) of all forms of taxation. Therefore in hard economic times the poor, who are impacted the most by a bad economy, spend less and the sales tax revenues decrease.

And what is our government's response? Increase the tax rate even more - in this case 10% in Oct. 2013 - in an effort to make up the loss revenues. Instead this action has two bad consequences: the poor are hit even harder; and tax revenues decrease even further.

Hopperthe2nd

Isn't this about the same time that food stamp benefits were cut?

pntbutterandjelly

Economic Euthanasia is working! Lower the wages, stop unemployment benefits, ship jobs off-shore, block any infrastructure jobs, kill the Unions, keep minimum wages down, hide corporate tax off-shore and sooner or later....no tax base. Isn't it wonderful?!? BUT...we live in the "Greatest Country" on Earth and we have Trickle Down Economics!

Of course the tax base is diminishing! How could it not?

And the 1% sleep well.

DEATHnTAXES

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