This indicator is part of Businesses develop & prosper.

Indicator description:

This indicator measures the year-over-year growth in Gross Receipts Taxes (GRT) as a percentage of overall economic activity. The one percent distribution provides a consistent measure of the growth of the tax base and measures the general health of the local economy. It is not affected by changes in the tax rate. For comparison, Personal Consumption Expenditures for the United States is a similar measure of the health of the U. S. economy.

Why is this indicator relevant?

Growth in Gross Receipts Taxes (GRT) is an indicator of the health of the local economy. Growth indicates more trade at those businesses that pay gross receipts taxes. GRT growth also provides prospective on how well the Albuquerque economy is performing in relation to the national economy, as measured by U.S. Personal Consumption Expenditures.

Data Sources:
City of Albuquerque, Office of Management and Budget, 2008; U.S. Department of Commerce, Bureau of Economic Analysis, 2002-2007; Global Insight, Inc.

What can we tell from the data?

• The year-over-year growth of the one percent distribution in Albuquerque averaged over 6% between fiscal years 2003 and 2007. However, the economic downturn that began in fiscal year 2008 resulted in no growth (0.0%) for that year. The steep decline in Albuquerque gross receipts taxes was primarily the result of a dramatic slowdown in construction activity.
• Annual growth in U.S. Personal Consumption Expenditures increased from 2003 to 2006, but then began a slow decline that continued into 2008. Although still above 5% in FY 2008, the US PCE is expected to decline and reflect negative growth in calendar year 2009.
• The effects of the recession in Albuquerque are similar to those of the national economy, but appeared earlier due to the local slowdown in construction.

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