Despite Oklahoma natural gas companies paying a pittance in gross production taxes in June, the state closed the fiscal year with $405 million more in general revenue than in fiscal year 2011 and topped revenue predictions for the year.
The increased state revenue was driven by gains in income tax and sales tax revenues, which increased by 13 percent and 9.7 percent, respectively, according to a report released Tuesday by the Office of State Finance. In total, the state brought in $5.543 billion for fiscal year 2012, compared to $5.138 billion the previous fiscal year.
However, gross production tax — the tax on oil and natural gas that varies based on the market price of each commodity — was down almost 12 percent this fiscal year compared to 2011.
“This preliminary report drives home the role consumer confidence has played in Oklahoma's economic recovery,” state Secretary of Finance Preston Doerflinger said in a statement Tuesday. “In June and at other times during the year, strong sales taxes helped ease energy tax variances due to low prices and tax rebates.”
Due to an anomaly in June, natural gas companies contributed nothing to the general revenue fund.
“June tax collections from natural gas totaled $15.3 million, but, after refunds of $12.3 million, contributed nothing to the general revenue fund,” the report states.
The refunds are tax credits or incentives given to natural gas companies. The remaining $3 million went to state coffers other than general revenue, said Shelly Paulk, deputy budget director and revenue analyst for the Office of State Finance.
The loss caused a nearly 60 percent single-month decline in gross production taxes over 2011.
Gross production taxes on oil totaled $32.9 million in June, which was also down significantly from 2011, the report states.
The news release Tuesday from the Office of State Finance focused on the good news that the state ended the fiscal year with record high sales tax collections — up 13.1 percent over June 2011.
The increased sales tax resulted in a single-month-record $306.8 million deposit into the Rainy Day Fund, which is the state's savings account for troubled times.
The fund now has $556 million, which is close to the all-time high.
“It's great to end the 2012 fiscal year on a high note, as the entire year was a boon for the Oklahoma economy as collections exceeded the previous year by nearly 10 percent,” Gov. Mary Fallin said in a statement. “Our pro-business policies are succeeding in growing the economy and providing more opportunities to Oklahoma families.”