When the City of Great Bend looks at its sales tax receipts in the October report, the total is lower than that of last year. But, city officials said that doesn’t tell the entire story.
“They are actually lower when you compare them to last October,” City Clerk-Finance Director Shawna Schafer said. “The state notified us that for some reason our September disbursement included all July and several days of August collections as well. So actually, the September disbursement was artificially high.”
The October report, which covers receipts from August, came to $339,481. The September report, which covered July, came to $484,669.
The taxes are collected through the Kansas Department of Revenue. The KDOR then distributes the tax collections to the city with a two-month lag time (the August distribution was received in October).
In Great Bend, the sales tax rate is 8.7%:
• 6.5% goes to the State of Kansas
• 1.0% goes to Barton County
• 1.2% goes to Great Bend. That is made up of five different sales taxes for the City:
• .50% – split three ways, 45% for capital improvements, 20% for economic development incentives, and 35% for property tax relief.
• .25% – approved by referendum and the collections started in 2009.
The tax will pay for the debt service on $5 million general obligation sales tax bonds that were issued to fund street replacements, maintenance, and repairs throughout the city. The excess sales tax that is not needed for debt service on this issue will be used for street projects.
• .10% – debt service construction of the new Justice Center.
• .15% – quality of life improvements.
• .20% – pension for public safety personnel (police and fire).
The last three (the Justice Center, quality of life and pensions) were just approved last November and collections didn’t start until April. Statewide, figures announced Tuesday show October’s total tax receipts were $740.1 million – 11% ($73.2 million) above the estimate, and $77.4 million, or 11.7%, more than October of last year. October marks the 27th month in a row in which the state has exceeded its estimated collections, according to Gov. Laura Kelly’s office.
Retail sales tax collections were $251.7 million, which is 9.4%, or $21.7 million, more than the estimate. Those collections are $24.0 million, or 10.5%, more than last October. Compensating use tax collections were $70.0 million, which is $2.0 million, or 2.7%, less than the estimate, but 3.6% more than October 2021.
Compensating use tax is paid by Kansas consumers to out-of-state retailers on goods purchased from other states but used in Kansas. It is also due if the other state’s rate is less than the Kansas rate of 6.5 percent paid at the time of purchase.
The compensating use tax rate is the same 6.5 percent as the state sales tax rate. Local use tax, if levied by a city and/or county, is imposed on all transactions which are currently subject to the state use tax.
In addition, individual income tax collections were $357.5 million, which is $52.5 million, or 17.2% more than the estimate. That is $55.9 million, or 18.6% more than October 2021. Corporate income tax collections were $32.5 million for the month. That is $0.5 million, or 1.6% less than the estimate and 18.9% less than October 2021. Corporate receipts for the first four months of FY 2023 are 7.6% greater than the same period in 2021.
The Consensus Revenue Estimating Group (CRE), comprised of the Department of Revenue, Division of Budget, Legislative Research Department, and economists from the University of Kansas, Kansas State University, and Wichita State University, will meet next Wednesday to review and possibly revise the FY 2023 estimate and make its initial forecast for FY 2024.
“Each time CRE has met over the past two years, we’ve raised our revenue forecasts, yet Kansas continues to beat the newer, higher forecasts every single month,” said Secretary of Revenue Mark Burghart. “We keep setting the bar higher and higher and clearing it every time – a real indication that the Kansas economy is strong.”
