Deep freeze in February slows consumer spending

D.E. Smoot, Muskogee Phoenix, Okla.
·2 min read

Apr. 21—Sales tax slid lower this month as extreme winter in February put consumer spending on ice.

Data compiled by the Oklahoma Tax Commission show the city's share of sales tax revenue disbursed this month totaled about $1.96 million. That represents a 3.18% decrease, or $62,276 drop, from the $2.02 million disbursed to the city in April 2020.

April sales tax disbursements primarily represent local sales tax receipts collected for business activity recorded in February, when residents experienced an extended period of sub-freezing temperatures. Totals include taxes collected on actual sales reported by businesses required to file electronically from Feb. 16 to Feb. 28 and estimated sales from March 1 through March 15.

The agency disbursed $144.36 million to municipalities statewide, an amount that was down $2.58 million, or 1.78%, from the $146.93 million disbursed in April 2020. Counties that assess a sales tax shared disbursements totaling more than $24.04 million and use tax revenue totaling more than $3.86 million.

Muskogee County's share of sales tax disbursements in April totaled $411,035, a 7.48% decrease from the $441,769 deposited the same month in 2020. The April disbursement of use tax revenue into Muskogee County coffers totaled $60,375, up 8.74% from the $55,096 deposited a year ago.

Muskogee's sales tax receipts for the first 10 months of fiscal year 2021, which ends June 30, totaled $21.94 million. That represents a 5.44% year-to-date increase, up $1.19 million, from the nearly $20.75 million deposited into city coffers during the same period a year ago.

The city's share of use tax revenue climbed higher than levels reported in April 2020. The tax commission's most recent report shows use tax revenue disbursed this month to the city of Muskogee totaled $254,570, up $18,390, or 7.22%, from the $236,180 deposited a year ago.

Use tax revenue, which can swing wildly from month to month, is generated primarily by purchases of out-of-state goods for in-state use or consumption. City councilors have dedicated $1.2 million of the city's annual use tax revenue to budget items that support economic development efforts.

Revenue from the 4 percent municipal sales tax — along with tobacco and franchise taxes — make up just more than half of the city's general fund. Much of the balance is generated by fees for utilities and services.