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North Dakota Sales Tax Revenues Showed Greatest Growth In US

  • Apr 27, 2012 | Susan McLain

KFYR-TV reported in September 2011 that sales tax revenues”…continued to grow this year despite major flooding” and indicated “[t]hat’s a jump of more than 30 percent compared to last year.”  According to the Census Bureau, the total tax revenue growth for North Dakota was definitely over 30 percent. It was 44.5 percent—the largest revenue increase of all of the states.

For North Dakota, the Bureau reports that severance tax revenue showed a 65.8 percent increase and was the largest category to increase for the state.

Let’s take a look at what policies North Dakota has…

Sales Tax Holidays? Clothing Exemption?

A sales tax holiday bill (HB 1309) providing for three days where clothing and school supplies were sales tax-exempt was rejected in January of 2011 by the state, citing that it “…would collect $1.25 million less in sales taxes during the 2011-13 budget period if the holiday were in effect, with local governments losing $375,000 in revenues.

In addition to the sales tax holiday bill, Senate Bill 2333, a bill exempting clothing from state sales tax was also rejected.

The clothing exemption has also been tried in previous years. In 2009, the House passed a bill to “…abolish the state’s sales tax on clothing.”

Sales Tax Increases or Decreases? Just a Sampling…

Sales tax rates were increased in June 2011 by two cities: Maddock and Minnewaukan by half percent after the tremendous Fiscal Year 2011.

Fargo City, North Dakota will sunset a “one half percent (.5%) of the current city tax…effective June 30, 2012.” However, the cities of Forman and Kindred increased their sales tax rate as of April 1, 2012. Previously, January 2012 also saw increases in the cities of Fairmount, Bisbee and Hope.

What Grew The Most?

According to North Dakota’s third quarter 2011 sales and use tax statistical report, the sales and use tax revenue grew 38.6 percent over collections in 2010. 2010 had seen 28.0 percent growth over 2009. As of the report, Retail trade, Wholesale trade and Mining and Oil Extraction were the three top revenue drivers for third quarter 2011. Mining had nearly doubled from the previous year, wholesale growth was nearly 45 percent and retail, a bit over 17 percent from 2010.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Susan McLain
Avalara Author Susan McLain
Susan McLain began her career as a technical writer in technology industries such as satellite networking and medical devices. Her skills encompass technical and marketing writing, usability engineering, verification and validation testing and protocol writing, requirements development, business analysis, technical illustration/graphic design and marketing. She has owned her own business providing service to small to medium sized business and in other positions, she has been in project management, documentation and marketing. She is currently the content specialist for Avalara helping to “make sales tax less taxing.”