9. EDSR 08-11-2008 - Laserfiche WebLink

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The University of Minnesota Extension has developed this retail trade analysis program to assist in the economic development of Minnesota towns and cities. These reports are available for all Minnesota counties, for most cities above 5,000 population and for a few cities smaller than 5,000 population. The retail sector of each jurisdiction can be evaluated b comparing its trends to those of other similar jurisdictions. Business people and economic development officials can use measures such as pull factors and leakages to determine the need and feasibility of new retail businesses. Data Sources Most of the data in the analysis are based on annual reports of Minnesota retail and use tax, published by the Minnesota Department of Revenue. The Department of Revenue published an annual report of sales and use tax by jurisdiction until 1996, at which time the reports were released biannually due to budget constraints. This analysis uses the available reports from 1990- 1996, 1998, 2000, 2003, 2004,2005 and 2006. The reports interpolate data for the years in which data are not available. (See http://www.taxes.state.mn.us/taxes/legal~olicy/research reports/sales_use_statistics_main.shtml) The income data in this repor are obtained from reports by Bureau of Economic Analysis (BEA). (See http://www.bea.gov/regionaUreis) Population data are derived from the U.S. Census. (See http://www.census.gov/popest/estimates.php) Sales and use tax permit holders file returns and remit taxes on either a monthly, quarterly or annual basis. Large businesses such as discount department stores whose tax is more than $500 per month are required to file on a monthly basis, while mediun sized businesses whose sales tax collections are less than $500 per month, are required to file on a quarterly basis and small businesses with sales tax collections less than $100 per month would most likely file on an annual basis. Definition of Terms Gross Sales Gross sales include taxable sales and exempt sales for businesses holding sales and use tax permits. This is the most inclusive indicator of business activity for the reporting jurisdictions but it can be misleading when used in comparisons. At times commodity items (like gasoline), that are not taxable, can have large price variations, creating huge swings in gross sales. Taxable Sales Taxable sales are the amount of sales subject to sales tax. Taxable sales exclude exempt items, items sold for resale, items sold for exempt purposes and items sold to exempt organizations. For more information on what is taxed in Minnesota, see "Minnesota Sales and Use Tax Instruction Booklet" availabe on the web at http://www.taxes. state.mn.us/taxes/sales/instructions/st_bk07.pdf) Current and Constant Dollar Sales Current dollar (or "nominal dollar") sales are sales as reported by the state. No adjustment has been made for price inflation. In general this measure of sales is not satisfactory for comparisons over long periods of time since it does not account for changes in population, inflation, or the state's economy. Constant dollar (or "real dollar")sales reflect changes in price inflation by adjustin current dollar sales with the Consumer Price Index (CPI). Constant dollar sales indicate the real sales level with respect to a base year. This is a more realistic method of evaluating sales over time than current dollar comparisons, but still does not take into consideration changes in population or changes in the state's economy. Page 1