Already reeling from a prolonged slump in energy and agriculture prices, a severe drought this summer in North Dakota likely will contribute to a third consecutive year of slipping average gross income for residents, state Tax Department officials said.
Figures released to The Associated Press show the reported gross income by North Dakotans dropped 7.6 percent in 2016, while the number of filers dropped by more than 27,000 from the year before.
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The late filing deadline for tax returns was last week.
A total of 477,344 returns were filed in 2016, down from about 504,703 in 2015, according to Tax Department analyst Kathy Strombeck. The average gross income for 2016 was $68,538, down almost $3,300 from the prior year, and more than $4,800 from the record set in 2014, data show.
Tax Commissioner Ryan Rauschenberger said the decrease in income and the number of North Dakota taxpayers the past two years is due largely to depressed agriculture and energy prices, while the drop in number of filers comes largely from oilfield workers who left the state.
An uptick in oil prices that has spurred some drilling in western North Dakota has been offset by one of the worst droughts to hit the state in decades. The drought put additional downward pressure on agriculture production and prices, Rauschenberger said.
The numbers are still well above the pre-oil boom numbers a decade ago. In 2006, there were 339,000 filers, with an average adjusted gross income of about $43,300.
"I think there will be some leveling off," Rauschenberger said of income tax revenue and filers. "Eventually we're going to see a turnover."