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Sales taxes collected in Lafourche and Terrebonne parishes continued to rise last year, with Lafourche in particular seeing a record holiday shopping season, although officials say the news is not so good at the state level.
State revenues are down one percent, mainly because corporate tax collection is down by 44 percent, according to a press release last week from State Treasurer John Kennedy.
Holiday shoppers in Lafourche Parish contributed to a nearly 12-percent-jump in sales taxes in January compared to that month last year, with $1,492,869.58 collected in sales tax. January 2014 was only 2.66 percent greater than the previous year.
Terrebonne Parish businesses suffered a slowdown in growth during the holidays, however, paying $12,553,882.48 in sales taxes, only 1.09 percent more than that point last year. Sales taxes collected in January 2014 were 15.83 percent more than in January 2013.
Businesses in both parishes have until the twentieth of each month to pay the previous month’s sales taxes they owe, so taxes collected in January are for purchases made in December.
“Ever since Katrina hit, our numbers have been good,” said Christa Lagarde, director of the Sales & Use Tax Department for Terrebonne Parish, in reference to her agency’s numbers.
Both parishes have seen sales tax collections go up since Hurricane Katrina in 2005, but they say that growth has slowed down significantly since this year’s oil prices began to fall. February and March are historically bad months for sales tax revenue for both parishes, with sales rebounding in April, so the true effect on sales tax revenue remains to be seen.
Kennedy acknowledged that state-wide sales tax collections are also healthy, but that other taxes at the state level are on the wane.
“Sales taxes are doing fine. I think that’s a product of the fact that because of cheap gasoline, we all have a little more money to spend and we’re spending it on retailers and restaurants and that sort of thing,” Kennedy said. “But the personal income tax and the corporate income and franchise tax [revenue] is disappointing.”
In May 2014, the state predicted revenues to grow by 4.3 percent through June of this year, Kennedy said in his release. Instead, revenues are down by one percent.
“So that’s a 5 percent swing, a 5 percent reduction, if you will,” Kennedy said. “And when you’re dealing with billions of dollars, 5 percent is a lot.”
Kennedy suspects the reduction in personal and corporate income tax collections on the price of oil.
Industries related to oil and gas represent 40 percent of Louisiana’s $220 billion economy, Kennedy said.
“If you look at the trend over the last four or five months, the trend has been down and that’s disturbing me more than anything else,” Kennedy said. “Unless the trend stabilizes, we could be looking at a larger than 1.6 billion dollar deficit to grapple with in next year’s budget.”
Clerk Shantell Jones hands Allison Anderson her change at Lowes Home Improvement in Houma. Sales tax generated from retail sales has been on a rise since 2008, but its growth rate has slowed since the oil glut of late.
