Treasurer reports record high tax revenue for past year in Oklahoma

 

Tax revenue in Oklahoma resulted in a record high in the past year according to an announcement by State Treasurer Todd Russ. It also included increased revenue from oil and natural gas taxes.

The 12-month gross receipts through January totaled $17.48 billion, an increase of nearly $2 billion or about 13% from the previous 12-month period.

Helping boost the revenue was the gross production tax on oil and gas which totaled $153.1 million. It represented a gain of $9.6 million or 6.7%.

Total receipts for the month of January were $1.59 billion which was 440.5 million or 2.7% more than January of 2022. But Russ also indicated there were some weak financial areas.

“The Gross Receipts report shows noteworthy improvement,” said Treasurer Russ. “Even so, higher interest rates are causing a slowdown in housing demand and other economic activity.”

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Over the past year, all major revenue streams reflected growth. Sales and use tax collections exceeded the rate of inflation of 6.5 percent, growing at 8.6 percent. Income tax receipts increased by 13.1 percent.

The monthly Oklahoma Business Conditions Index rose slightly in January. This index, produced by Creighton University, increased from 40.2 in December to 43.3 depicting some economic improvement. However, an index number under 50 indicates a forecast for potential contraction during the next three to six months.

Other indicators

As measured by the Consumer Price Index, the U.S. Bureau of Labor Statistics (BLS) reports the annual inflation rate at 6.5 percent in December. The energy component of the index at 7.3 percent over the year is expected to remain high, along with the food index which stands at 10.4 percent.

Oklahoma’s employment numbers continue to exhibit strength, despite changes in workforce trends. The Oklahoma unemployment rate in December stayed at 3.4 percent, as reported by the BLS. This rate has not changed since September. The U.S. jobless rate was 3.5 percent in December, down by one-tenth of a percentage point from November.

According to Federal Reserve Economic Data from 2022, average mortgage rates doubled from 3.5 percent to 7 percent during the beginning of last year through October. Thereafter, 30-year mortgage rates have declined to approximately 6 percent, but the relatively high rates coupled with higher housing prices have caused a drop in housing demand.

January collections

January 2023 collections compared to gross receipts from January 2022 show:

  • Total monthly gross collections are $1.55 billion, up by $40.5 million, or 2.7 percent.
  • Gross income tax collections, a combination of individual and corporate income taxes, generated $550.4 million, down by $3.1 million, or 0.6 percent.
    • Individual income tax collections are $482.2 million, an increase of $35.9 million, or 8.0 percent.
    • Corporate collections are $68.2 million, down by $38.9 million, or 36.4 percent.
  • Combined sales and use tax collections, including remittances on behalf of cities and counties, total $629.4 million – up by $32.3 million – or 5.4 percent.
    • Sales tax collections total $515.2 million, an increase of $21.9 million, or 4.4 percent.
    • Use tax receipts, collected on out-of-state purchases including internet sales, generated $114.2 million, an increase of $10.3 million, or 9.9 percent.
  • Gross production taxes on oil and natural gas total $153.1 million, an increase of $9.6 million, or 6.7 percent.
  • Motor vehicle taxes produced $74.1 million, up by $5.4 million, or 7.8 percent.
  • Other collections composed of some 60 different sources produced $141.8 million – down by $3.7 million, or 2.5 percent.

Twelve-month collections

Combined gross receipts for the past 12 months compared to the prior period show:

  • Gross revenue totals $17.48 billion. That is $1.98 billion, or 12.8 percent, above collections from the previous 12 months.
  • Gross income taxes generated $6.0 billion, an increase of $700.5 million, or 13.1 percent.
    • Individual income tax collections total $5.0 billion, up by $587.3 million, or 13.2 percent.
    • Corporate collections are $1.0 billion, an increase of $113.2 million, or 12.8 percent.
  • Combined sales and use taxes generated $6.9 billion, an increase of $544.3 million, or 8.6 percent.
    • Gross sales tax receipts total $5.8 billion, up by $428.5 million, or 7.9 percent.
    • Use tax collections generated $1.0 billion, an increase of $115.8 million, or 12.3 percent.
  • Oil and gas gross production tax collections generated almost $2.0 billion, up by $747.2 million, or 59.9 percent.
  • Motor vehicle collections total $875.7 million, an increase of $3.0 million, or 0.3 percent.
  • Other sources generated $1.7 billion, down by $13.5 million, or 0.8 percent.