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Politics & Government

Taxable sales and purchases for 2nd quarter of 2016 down 26 percent

Taxable sales and purchases in North Dakota for the second quarter of calendar 2016 were down nearly 26 percent from where they were a year ago.

Tax Commissioner Ryan Rauschenberger said taxable sales and purchases totaled $4.4 billion for the months of April, May and June. He said what’s driving it is the downturn in energy and agriculture.

"Essentially, we're seeing our numbers going back to a pre oil boom number," Rauschenberger said.

Rauschenberger says it’s comparable to the same quarter in 2011. He said a big issue this year is the number of oil wells going uncompleted.

"Most of the sales tax from a well -- about $250,000 per completed well -- is from the hydraulic fracking process," Rauschenberger said. "The sand, the trailers, the trucks, the chemicals -- that is all subject to sales tax."

Rauschenberger said that's why so much of the sales tax hasn't been realized -- wells are drilled, but are not being completed.

The Tax Commissioner did say a bright spot has been retail. He said retail was only down about seven percent.

"That shows people are employed," Rauschenberger said. "They feel safe in their jobs. And that has really held its own. and that's a good indicator for the long term strength of the North Dakota economy."

In 2014, taxable sales and purchases for the second quarter totaled $7 billion.

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