Minnesota’s Consumer
Expenditure Survey Uses
Phillip Anthony and Paul Wilson
Minnesota Department of Revenue
Presentation at the CES Data Users’ Forum
B
Bureau
off L
Labor
b St
Statistics
ti ti
June 21, 2010
CE E
Experience
i



Minnesota has been producing an incidence study for
nearly 20 years
M third
My
thi d year working
ki with
ith th
the PUMS d
data
t ffor th
the
Minnesota Department of Revenue
Seven years with the Nebraska Department of Revenue
using aggregate data from CE
O Audiences
Our
A di


Minnesota Government
 Tax Committees
 Legislative Research Office
 Governor’s Commissions
F d ti off Tax
Federation
T Administrators
Ad i i t t
Pi
Primary
T
Topics
i


The incidence of sales and excise taxes in Minnesota for
the Minnesota Tax Incidence Study
P li analysis
Policy
l i

Exemption Levels
 Sales tax rebates
 Incidence of Tax Exemptions
Minnesota Tax Incidence Analysis



Geographic Level
 National level data
Time Period
 A combination of most recent three y
years PUMS files
Data Files Used
 Interview Data
 Only consumer units that complete all the interviews
 FMLI and MTAB Files
 Diary Data
 FMLD and EXPD Files
 Data is categorized into nine household types


Single Seniors, Married Seniors, Singles, Married no children, Married one child,
Married two children,
children Married three or more children
children, Single one child
child, Single two or
more children
No Topcoded records used in analysis
Mi
Minnesota
t Tax
T Incidence
I id
Report
R
t
Taxes as a Percent of Income
25%
9%
Alll Taxes
20%
All Taxes Total ETR
11.36%
8%
=
7%
General Sales Total ETR =
2.16%
15%
6%
5%
4%
10%
3%
2%
5%
1%
0%
0%
1
2
3
4
5
6
Deciles
7
8
9
10
General Sales
All Taxes
General Sales
Analysis of Adding Legal Services to the Sales Tax Base
Effective Tax Rates, Population Deciles
9.00%
0.10%
General Sales
8.00%
0.09%
Legal Services Suits = 0.290
0.08%
7.00%
Generaal Sales Tax
0.06%
5.00%
0.05%
4.00%
0.04%
3.00%
0.03%
2.00%
0.02%
1.00%
0.01%
0.00%
0.00%
1
2
3
4
5
6
Deciles
7
8
9
10
0
Legall Services
0.07%
6.00%
Analysis of Adding Clothing to the Sales Tax Base
Effective Tax Rates, Population Deciles
9.00%
1.00%
General Sales
8.00%
Clothing Suits = ‐0.164
0.80%
6.00%
0.60%
5.00%
Cllothing
General SSales Tax Rate
7.00%
4.00%
0.40%
3.00%
2.00%
0 20%
0.20%
1.00%
0.00%
0.00%
1
2
3
4
5
6
Deciles
7
8
9
10
0
Ventura Sales Tax Refund Program
FULL-YEAR RESIDENTS
Joint and Head of Household Returns
(and Qualifying Widow(er)s)
Average
g Sales
Tax Burden
Counts
1999
Taxable Income
Less than $2,500
2,500
- $ 4,999
5,000
9,999
10,000
14,999
15,000
19,999
20,000
24,999
25,000
29,999
30,000
34,999
35,000
39,999
40,000
44,999
45 000
45,000
49 999
49,999
50,000
59,999
60,000
69,999
70,000
79,999
80,000
89,999
90,000
99,999
100 000
100,000
- 119,999
119 999
120,000
- 139,999
140,000
- 159,999
160,000
- 179,999
180,000
- 199,999
200,000
- 399,999
400 000
400,000
- 599,999
599 999
600,000
- 799,999
800,000
- 999,999
1,000,000and over
Total
Average
$
575
715
750
826
936
1,012
1,079
1,172
1,275
1,384
1 470
1,470
1,506
1,572
1,711
1,848
2,001
2 167
2,167
2,374
2,566
2,747
2,919
3,733
4 912
4,912
5,894
6,757
9,481
29,760
32,546
67,078
64,143
63,021
64,862
67,125
67,594
67,651
65,549
59 837
59,837
97,223
68,516
46,082
31,489
22,018
27 696
27,696
16,132
10,640
7,225
5,345
19,245
4 687
4,687
1,874
976
2,464
1,010,778
Sales Tax
Rebate
$
235
292
306
337
382
413
441
479
521
565
600
615
642
699
755
817
885
969
1,048
1,122
1,192
1,524
2 006
2,006
2,407
2,759
3,250
Total Rebate
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
6,993,600
9,503,432
20,525,868
21,616,191
24,074,022
26,788,006
29,602,125
32,377,526
35,246,171
37,035,185
35,902,200
35 902 200
59,792,145
43,987,272
32,211,318
23,774,195
17,988,706
24,510,960
24 510 960
15,631,908
11,150,720
8,106,450
6,371,240
29,329,380
9,402,122
9 402 122
4,510,718
2,692,784
8,008,000
577,132,244
571
Special Projects
j



Geographic Level
 National level and regional level data
Time Period
 A combination of the most recent three years PUMS files
Data Files Used
 EXPN Data
 Interview Data
 Only consumer units that complete all the interviews
 FMLI and MTAB Files
 Diary Data
 FMLD and EXPD Files
 Data is categorized into nine household types


Single Seniors, Married Seniors, Singles, Married no children, Married one child,
g one child,, Single
g two or
Married two children,, Married three or more children,, Single
more children
No Topcoded records used in analysis
H ti Fuels
Heating
F l Special
S
i lP
Project
j t


The current sales tax base exempts heating fuels during the heating
season
Change from and outright exemption to exemption the first “X”
X
dollars of heating expenditure during the heating season
Diffi lti and
Difficulties
dC
Concerns



Topcoding
 20% of households in our incidence study have an income
greater than $86,000 per year – 45% of total sales taxes dollars
 5% of households are over $175,000 per year - 20% of total
sales taxes dollars
Spending on goods subject to excise taxes
 CE data does not provide data on volume of cigarettes or alcohol
consumed
Small sample sizes
 Some spending categories have a high percentage of
households with zero spending in particular categories
Hotel Expenditures by Senior Single
Households
Difficulties and
dC
Concerns


Intrastate spending vs. interstate spending on travel
expenditures
D t “Impenetrability”
Data
“I
t bilit ”

Short lead times for projects
 Other States may
y lack the technical abilities