Sales tax up in the Bakken; flat or down other places

Sep 4, 2018

As activity ramps up in the Bakken, sales tax collections from that part of the state are also ramping up.

Sales tax collections declined when the oil boom slowed down – and that was a big part of the reason the 2017 Legislature had to cut budgets.

And it also affected city sales tax collections.

"We're experencing a bit of a decline in those collections," said Bismarck city administrator Keith Hunke. "In 2015, we collected about $17.5 million; in 2016, we collected $16.7 million; and last yar, we collected $15.7 million."

Hunke said so far in 2018, the collections are very close to what was collected in 2017.

"We're hoping we've plateaued, and won't continue to decline," Hunke said.

Hunke saids this comes as the city continues to grow, and add retail. He said one could speculate that the decline was related to the slump in the oil patch – and the city doesn’t see the reports the retailers give to the state Tax Department.

"We have a hunch that some of those big-ticket items are no longer being purchased in Bismarck," Hunke said. "Other cities, over the last several years, have added some big box stores -- maybe that's kind of taken some of that revenue away from us. That's only a guess on our part."

Hunke said it will also be interesting to see what happens after October first, when the state starts collecting sales tax from on-line retailers that do not collect those taxes.