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600 E. Boulevard Ave.
  Bismarck, ND 58505-0599
  701.328.7088 phone
  701.328.3700 fax
  877.328.7088 toll-free
FOR IMMEDIATE RELEASE Contact: Kathryn Strombeck, Research Analyst, 701.328.3402
Tuesday, April 6, 2010 Beth Boustead, Public Information Specialist, 701.328.3039

Fong: 4th Quarter Taxable Sales & Purchases Remain on Track

BISMARCK, N.D. – Tax Commissioner Cory Fong announced today that during the months of October, November, and December, North Dakota’s overall taxable sales and purchases slowed by 7.9 percent, or by $269 million, compared to the same time period during 2008. Taxable sales and purchases are up when compared to fourth quarter 2007 statistics.

“North Dakota experienced a record-setting year for taxable sales and purchases in 2008, and that level of growth was not sustainable,” said Fong. “When we compare 2009 to 2007, which is a more typical year, fourth quarter spending levels were strong and indicate that North Dakota’s economy remains on track.”

The fourth quarter 2009 report shows growth of 10.9 percent or $307.8 million compared to the same timeframe in 2007.

Seven of fifteen sectors reported growth during October, November, and December of 2009. The retail trade sector, the sector that is mainly looked to as a measure of the economy, was up the most in terms of dollars, growing $27.6 million or 2.3 percent compared to fourth quarter of 2008.

“The retail trade sector is an especially important sector to watch during the fourth quarter because it encompasses the all-important Christmas shopping season,” said Fong. “So a strong showing in our retail sector during the Christmas season is an especially good sign. While other states continued to feel the effects of the recession, North Dakotans remained upbeat and continued to spend.”

Comparing the retail trade sector to the fourth quarter 2007, shows growth of 3.1 percent. The rate of inflation for the same time was about 2.1 percent.

The largest percentage increase came in the other services sector, which was up 13.2 percent when compared to 2008. Other sectors that reported growth during the fourth quarter of 2009, include the financial, insurance, real estate, rental and leasing sector, up 9.5 percent; professional, scientific, technical, and management services sector, up 5.1 percent; information industries, up 3.5 percent; educational, health care, and social services, up 2.6 percent; and accommodations and food services sector, up 2.1 percent.

Sectors reporting a decline include: mining and oil extraction sector, down 44.8 percent; utilities, down 43.5 percent; transportation and warehousing, down 23.8 percent; manufacturing, down 16.4 percent; wholesale trade, down 13 percent; miscellaneous, down 3.3 percent; construction, down 2.7 percent; and arts, entertainment and recreation, down 0.7 percent.

“The drop in the mining and oil extraction sector is not reflective of production, which continues to flourish, rather the drop simply reflects a supply build up,” said Fong. “In the utilities sector, the figures point to the exemption from sales tax for natural gas used in heating and industrial purposes. The result of this exemption is reflected in a number of sectors.”

The exemption from sales and use taxes for sales of natural gas became effective July 1, 2009. If natural gas had been taxable in the fourth quarter, taxable sales would have been about $89 million greater than the amount reported and the total decrease for the quarter would have been about five percent.

Of the 50 largest cities, the biggest percentage increases for fourth quarter of 2009 were Washburn, up 33.8 percent; Bowman, up 26.6 percent; Rugby, up 25.9 percent; New Town, up 25.6 percent; and Harvey, up 18.6 percent.

The four largest cities, Bismarck, Fargo, Grand Forks, and Minot, contributed $17.2 million in growth during the fourth quarter. Minot showed growth of 6.3 percent, or $14.9 million; Grand Forks grew 1.5 percent or $3.9 million, Bismarck grew 0.25 percent, or $876 thousand; while Fargo remained relatively flat, with a decrease of 0.4 percent or $2.4 million.

The biggest percentage fourth quarter decreases for the 50 largest cities, were in Cando, down 40.5 percent; Kenmare, down 31.1 percent; Williston, down 22.6 percent; Walhalla, down 16.3 percent; and Tioga, down 15.2 percent.

Counties with the highest percentage increases were Oliver, up 45.7 percent; Bowman, up 26.4 percent; Pierce, up 25.8 percent; Renville, up 25.3 percent; and Grant, up 23.6 percent.

The counties with the biggest percentage decreases were Burke, down 65.2 percent; Dunn, down 44.3 percent; Towner, down 33.9 percent; Williams, down 21.5 percent; and McHenry, down 10.5 percent.

Complete North Dakota Sales and Use Tax Statistical Reports from Fourth Quarter 2009 can be accessed on the web at: www.nd.gov/tax/salesanduse/pubs/.

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  • 2009 Fourth Quarter Sales and Use Tax Statistical Report - (45kb pdf)
  • Graph: North Dakota Taxable Sales & Purchases 4th Quarter 2003 - 2009 - (41kb pdf)
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