The Norman Transcript

Editorials

June 13, 2013

Live, die by sales tax

NORMAN — Norman’s on-again, off-again love affair with the municipal sales tax has taken a hiatus. The numbers are up only slightly and less than what was projected in the city’s fiscal budget.

Taxes are up less than 2 percent for a budget that projected growth of more than 4 percent. Other revenue categories are up, so the city’s budget is essentially flat.

The city has delayed filling vacant positions, put off some purchases and taken other cost-saving measures. Officials think the numbers could tick upward in future months as consumers gain confidence in the economy.

“It’s complex, with a lot of moving parts, but it’s related to the economy and the psychological impacts,” city finance director Anthony Francisco said in a Transcript interview. “I think people are just cautious, particularly as it relates to discretionary spending.”

Financing of government functions is indeed complex. Cities and towns in Oklahoma are tied closely to sales taxes. Counties and schools rely on property taxes and state revenues, and state government relies primarily on sales, income and oil and gas production taxes.

The city’s relatively flat growth reminds us of the importance of shopping local. Legislation to establish an online sales tax has stalled in Congress. It would level the sales field for those local retailers who have to charge sales tax on every purchase.

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