Sales tax exemption-fertilizers, herbicides and pesticides.

05LSO-0218.C1

                                                         

FISCAL NOTE

 

	FY 2006	FY 2007	FY 2008
NON-ADMINISTRATIVE IMPACT
Anticipated Revenue Decrease:
GENERAL FUND	209,965	216,264	220,752
LOCAL SOURCES FUND	137,660	141,790	146,044

 

Source of revenue decrease:

 

Sales and use tax exemption of herbicides and pesticides.

 

 

Assumptions:

 

The above estimates are based on information from USDA surveys and compiled into a Census of Agriculture for 1997 and 2002. The total purchases for herbicides and pesticides were $11,968,000 in 1997 and $10,532,000 in 2002. The average of those two periods is $11,250,000. Material cost is estimated to be 60 percent of purchases ($6,750,000) with the balance assumed to be labor, based on historical averages.

 

The above estimates assume an average total sales tax rate (including local option taxes) of 5 percent.

 

The above estimates assume a 3 percent growth rate.

 

This bill is effective immediately. The revenue decreases for the remainder of FY 2005 are estimated at $51,000 to the General Fund and $33,000 to the Local Sources Fund.

 

 

 

 

 

 

 

 

Prepared by:   Dean Temte, LSO    Phone:   777-7881

(information provided by Rich Reynders, Dept of Rev.; phone 777-7904)