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West Jordan Journal

A note about sales tax revenue in West Jordan

Oct 04, 2022 12:19PM ● By Erin Dixon

By Erin Dixon | [email protected]

Inflation is ballooning everywhere; even West Jordan City is feeling the bloat.

In a sales tax revenue report to the city council in late August, Danyce Steck, Finance Director, relayed some tough news.

“While we saw 1% (May) or 5% (June) growth, we actually would consider that a decrease in sales tax because there was a 10% inflation factor,” Steck said.

The higher percentage means that West Jordan residents are spending more, but the inflation percentage means they are getting less for their money because of inflation.

“Consumers are actually spending more dollars but receiving less goods or services,” Steck said. “It also tells me that we are seeing some consumer confidence waning since sales are not increasing at or above inflation.”

In an interview with City Journals, Steck gave an example to illustrate the problem. “Last June you bought 25 apples for $25.00 ($1 each). This June, you spent $26.25 (5% more) but were only able to buy 23 apples (10% price increase). Yes, there was an increase in sales but there was a decrease in product sold.”

The city, in turn, is also being charged more for their purchases, which puts a strain on the budget.

“We are also having to spend more for less. Both labor and product costs (such as asphalt and fuel) are outpacing revenue increases,” Steck said.

Inflation and product costs are hard to predict, so the incoming/outgoing costs on the budget were best guesses. Budgets are always a bit of a guessing game, but with the rapid changes, this year is even less predictable.

“My comments to the council were cautionary,” Steck said. “We prepared for inflation in the budget as much as possible…. We are continuing to monitor the budget for stresses due to inflation.”