“Oklahoma’s economy was hitting on all cylinders in April, especially compared to where we were a year ago,” proclaimed Oklahoma Treasurer McDaniel as he announced a 38% jump in gross receipts to the Treasury during the month of April.
What drove it? In part, record oil and gas production tax collections along with increases in sales and income tax payments.
“Consumer confidence is on the rise, reflecting growing optimism about the economy,” remarked McDaniel.
Gross production taxes on oil and natural gas totaled $133.7 million, an amount that increased by $73 million or 120.3% from April 2020. While the energy sector jumped in April, the state’s oil and gas gross production tax collections in the past year were $645.3 million down $312.1 million or 32.6% from the previous year.
April’s gross production tax revenue was the highest monthly total in more than a decade. Collections for the month reflect oil field production during February when natural gas prices spiked during the record cold snap and crude oil prices were on the rise.
Collections from all sources in April 2021 total $1.49 billion, up by $413.2 million from April 2020. Some increase was expected because last April was the first full month of the pandemic and receipts were negatively impacted by a delay in the income tax filing deadline.
Even so, the increase was not from income taxes only. McDaniel reported that every major revenue stream rose by double-digit percentages, including a 73 percent boost in gross production taxes on oil and natural gas and a 32 percent surge in sales and use tax receipts. Combined individual and corporate income taxes grew by 36.4 percent for the month.
The Oklahoma Business Conditions Index in April remained above growth neutral for a fifth consecutive month. The April index was set at 70.9, its highest level in 10 years. Numbers above 50 indicate economic expansion is expected during the next three to six months.
Sales tax receipts not only exceeded collections from a year ago, but also topped those from April of 2019. Much of the increase is attributed to expenditure of federal stimulus payments, which pumped billions of dollars into the Oklahoma economy.
Combined gross receipts from the past 12 months of $13.56 billion are above collections from the previous 12 months by $342.8 million, or 2.6 percent. The growth ends a one-year contraction in 12-month receipts.
Employment picture
The March unemployment rate in Oklahoma was reported as 4.2 percent, according to the U.S. Bureau of Labor Statistics. The state’s jobless rate was down by two-tenths of a percentage point from February, but up from 3.2 percent in March 2020. The U.S. unemployment rate was set at 6 percent in March.
April collections
Compared to gross receipts from April 2020, collections in April 2021 show:
- Total April 2021 gross collections are $1.49 billion, up $413.2 million, or 38.3 percent.
- Gross income tax collections, a combination of individual and corporate income taxes, generated $553.4 million, up by $147.5 million, or 36.4 percent.
- Individual income tax collections are $414.1 million, an increase of $45.7 million, or 12.4 percent.
- Corporate collections are $139.3 million, up by $101.8 million, or 272.1 percent. Large monthly variances in corporate collections are not uncommon.
- Combined sales and use tax collections, including remittances on behalf of cities and counties, total $568.1 million – up by $137.6 million, or 32 percent.
- Sales tax collections total $481.4 million, an increase of $113.1 million, or 30.7 percent.
- Use tax receipts, collected on out-of-state purchases including internet sales, generated $86.7 million, an increase of $24.6 million, or 39.5 percent.
- Motor vehicle taxes produced $78.4 million, up by $25.5 million, or 48 percent.
- Other collections composed of some 60 different sources including taxes on fuel, tobacco, medical marijuana, and alcoholic beverages, produced $158.5 million – up by $29.5 million, or 22.9 percent.
- The medical marijuana tax produced $6.2 million, up by $1.9 million, or 45 percent from April 2020.
Twelve-month collections
Combined gross receipts for past 12 months compared to the trailing 12 months show:
- Gross revenue totals $13.56 billion. That is $342.8 million, or 2.6 percent, above collections from the previous period.
- Gross income taxes generated $4.91 billion, an increase of $525.1 million, or 12 percent.
- Individual income tax collections total $4.17 billion, up by $313.2 million, or 8.1 percent.
- Corporate collections are $736.6 million, an increase of $211.9 million, or 40.4 percent.
- Combined sales and use taxes generated $5.66 billion, an increase of $138.7 million, or 2.5 percent.
- Gross sales tax receipts total $4.82 billion, up by $28.4 million, or 0.6 percent.
- Use tax collections generated $840.2 million, an increase of $110.4 million, or 15.1 percent.
- Motor vehicle collections total $801.8 million, an increase of $23.6 million, or 3 percent.
- Other sources generated $1.55 billion, down by $32.6 million, or 2.1 percent.
- Medical marijuana taxes generated $64.8 million, up by $29.3 million, or 82.4 percent.
Source: OK Treasurer press release
