Monday, February 16, 2015

Budget basics: The major food groups

The City of West Buechel receives the majority of its revenue from property taxes, employee payroll tax (Occupational Tax), business income taxes, bank franchise taxes and insurance tax. There is a minor revenue source from a business license tax that has been lumped in with the business income tax, but it is conceptually distinct.

It used to be there was a tax on gross business income, but that was changed to a tax on net business profits a few years back. The shift between the two taxes happened between 2009 and 2010.I have been told there were considerable tax refunds made because of the transition from gross to net business income taxation.

All of this information has been extracted from the City's annual audits for FY 2009 to FY 2014. Each of these annual audit reports are available online, except for one. They can be found at the Kentucky Bond Corporation's web site.

There are other City revenue sources in addition to these six basic types.

 The audit report for the year ending June 30, 2014 is the most recent reliable and readily available source of fiscal information. The City's income from these  basic taxes for 2013 - 2014 was $1,505,000. The City can reasonably expect to receive about $1,580,000 from these same taxes during the fiscal year ending June 30, 2015, and about 5% more the following year, if the creek don't rise.

These numbers present a few puzzles.

Like, why did insurance tax receipts double from 2011 to 2012?

Why did net business tax collections fall by half from 2010 to 2012?

Next: Other revenue sources.

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