Tax Results
I have scrolled through forum discussions on taxes, and I have read documents posted on the IMPLAN website, but I still need clarification.
In trying to understand the tax view. The estimated taxes always seem low to me when viewing the outputs.
To provide a simple example using IMPLAN V3 (2008), I have created an activity (industry change) in Colorado, and the event is construction spending of $1M. IMPLAN estimates 7 employees and $278,571.50 in employee compensation based on this level of activity.
After analyzing the scenario, IMPLAN provides the Tax Results for 2011 state/local (attached). While many of these figures seem low, the "Households" tax seems especially low. For instance, the property taxes is estimated at $271. Also, I do not see an estimate for sales and use taxes for households.
Additionally, I see "Corporate Profits Tax." Would this be the business income taxes? Based on the state income tax rate, this would imply profits of $21k on the $1M of expenditures, or 2.1%. This also seems low.
Thanks for explaining this to me!
Was this post helpful?
-
Appendix A of the tax impact document shows what the various data elements mean. Household payment to property tax is tax on personal property (eg, car or boat). Household real estate taxes actually show up as Indirect business tax payment to property tax - "owner occupied housing" is treated as an industry in input-output analysis, and it is the "industry" payment to IBT that represents real estate taxes by homeowners. The $1 million would represent gross sales, the corporate profit taxes would only tax the profit from the $1 million sale. Profit for most industries is split between corporations and self-employment which would serves to water down the actual profit tax since self-employment would pay income tax (through households). Sales tax is collected by Retail trade or the services that collect sales tax and is turned over to the state/local government via IBT.0
Please sign in to leave a comment.
Comments
1 comment