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Valley sales-tax figures are mixed bag



Published: Thu, November 8, 2012 @ 12:00 a.m.

By Jamison Cocklin

jcocklin@vindy.com

YOUNGSTOWN

Sales-tax collection across the Mahoning Valley in August failed to keep pace with the gains made in the previous six months, and in most cases, came in under 2011 revenues.

The figures, reported by the Ohio Department of Taxation, are delayed because of the 60-day turnaround required for merchants to report the figures and the time it takes for the Department of Taxation to process the funds and send them out to both the state and its 88 counties.

August was a low point for both Mahoning and Columbiana counties, while Trumbull managed to collect more this year than last.

But between January and August, the Valley’s combined sales-tax collection, when adjusted for inflation, was up by 3.4 percent, with all three counties collecting $46.6 million in August versus only $44.3 million in the same month last year.

“Sales-tax figures are notoriously volatile from month to month,” said Cleveland-based economist George Zeller. “They can bounce up and down for no apparent reason both during growth periods and also during periods of recession.”

Zeller said the three- county data combined is above inflation, which means it represents genuine growth and not just price increases.

Sales-tax data often are used as a benchmark for economic stability in a given region, as they provide economists and government officials with a window into how much consumers are spending on retail purchases.

In Mahoning County, where $2.5 million was collected in August, the county saw a 5.1 percent decline in collection compared with last year.

At the same time, Columbiana County, which has posted stellar gains since at least March, collected 7.3 percent less than it did in 2011, bringing in $1.2 million.

Trumbull County was on its own in August, increasing sales-tax collections by 4.4 percent, generating a little more than $2 million that month.

All the fluctuations were calculated for inflation using the consumer price index.

“I have, frankly, been surprised that the sales-tax collections have been coming in as well as they have been during earlier months,” Zeller said of a trend that mostly has continued uninterrupted since late 2011. “This has been true across the entire state.”

Statewide collections have exceeded the Ohio Office of Budget and Management’s 2011 projections.

Zeller said that an increase in the sales-tax collection could be a result of the state’s adding more jobs in 2011, when it began to slowly recover from the national recession, but he added that wages dropped during the same time.

In the past six months, state and local officials have attributed the gains to pent-up demand held over from the recession and the stimulative effect of the oil and gas boom in the eastern part of the state.


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