Current Tax Revenue for an Industry

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    IMPLAN Support
    Hello Victoria, Here are couple thoughts/possibilities depending on what you are looking for: [ul] [li]If you are looking for total payroll and other taxes paid, or if you are looking for a tax type breakdown then yes the easiest way to view this is by running an analysis and then using the tax impact forms. In this case you could enter the total company or Sector sales and view the associated View By:Direct Taxes to see the tax estimate associated to that industry. (You would not want to report the results as the contribution of the industry however, if you are looking at the entire Sector's Output. Please let us know if you are also looking to talk about an entire Sector's contribution to the economy and we can point you to instructions for contribution analysis.[/li] [li] You could also calculate the Value Added of the industry of interest through the SAM, but this is more work than the impact analysis method and will take some extra time to pull out the detail.[/li] [li If you have access to it, you can apply the US total to the US model and divide to the 51 states weighted by state Output. This would ignore state differences in National average taxes, so it is probably not desirable.[/li] [li]Or if you aren't considered about payroll and income taxes, you can see the sales taxes and other Taxes on Production and Imports rolled into a single value in the Explore> Social Accounts> Balance Sheet (Tab), and select View By: Industry Balance Sheet and the Commodity Demand tab.[/li] [/ul] Hopefully one of these will work for you. Please let us know if you have any additional questions.
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    vdivino
    Thank you for your help! Yes I am looking for total payroll and other taxes (social security, income tax, business tax, property tax etc.) for the sector in question. Can you tell me where to find the total company or Sector Sales, which I should enter in as the industry sales? I see cost data in the Explore tab. In Study Area Data I see "Output", "Employee Compensation" and Proprietor Income and "Other Property Type Income", by Industry, which may be relevant. In Social Accounts Explorer I see Commodity Production. I'm not sure what to consider Sales?
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    IMPLAN Support
    Hi Victoria, Output is the Gross Sales value, so this is what you will want to use for Industry Sales when making an estimation of Direct Taxes. If you want to talk about the industry in any way other than taxes, you will want to [url=http://implan.com/v4/index.php?option=com_multicategories&view=article&id=660:660&Itemid=14]run a contribution analysis[/url] for the industry to look at other results. The contribution analysis method constrains the Direct impacts so that the Total results (including rounds of Indirect and Induced purchasing that occur in that Sector)will sum to the total regional value of the Sector. The only reason we don't recommend this for the tax impact report is that then the industry's taxes will be embedded in Direct, Indirect and Induced reports, and because these reports are by transaction type, not paying industry, you would not be able to determine how much of the taxes were associated to just your industry of interest. Please let us know if you have any additional questions.
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    vdivino
    Thank you for the clarification! Actually I want to calculate total (both direct and indirect) tax revenue for the industry, and I only want to report this overall, so I think I would use the contribution analysis?
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    IMPLAN Support
    Hi Victoria, By putting the full value of the Sector for Industry Sales for that industry into the Direct, you will actually be capturing ALL (Direct, Indirect and Induced) rounds of taxes paid by that industry in the Direct tax impact. This is also the only way to isolate that industries taxes from the other industries stimulated by that businesses purchases and payroll. The contribution analysis is a method that constrains the initial value of Industry Sales so that when all rounds of Indirect and Induced purchases are made to that industry you end up with a total sales value of the Sectors Total Output. If you are looking at the contribution of a Sector to a region this is very important so that you don't overestimate an Sectors contribution to the economy. For example, let's say that Sector 99 window manufacturing had a total Output for 2011 of $100million in our economy, and we wanted to see what would happen if the Sector left the region. If we entered Industry Sales = $100 million we would see that we actually lose say $113 million of window production from the region, which would be impossible since we only had $100 million in the first place. Likewise, not just more window activity is represented in the results, but also more of every other Indirect and Induced interaction is represented. So when we are interested in ALL the analysis results, we want to be sure to look at an entire Sector with a contribution analysis so that the total window production at the end of the analysis (with Indirect and Induced purchases of windows included we have $100MM. In your case, it appears that you just want to see the taxes associated to this $100 million of production and you aren't using and other results other than the Direct tax impact form. In this specific instance, because you are only considering the Direct tax impact form, it is fine to put the entire sales value ($100 million from the above example)as Industry Sales so that you can see the taxes associated to that sales value (which includes all rounds of purchasing of that Sector in that region). Since you aren't considering the Indirect and Induced tax impact forms, there is no concern in isolating the taxes associated to your industry by applying the Sector's Total Output to Industry Sales. Hopefully this helps to clarify. Please let us know if you need additional help or clarification.
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    vdivino
    Thank you for your help! Can you please confirm the below? To calculate state and local tax revenue, Direct Output is entered in the Industry Sales, for the industry of interest. If I want total (direct, indirect, induced) tax impact for that industry (including tax revenues incurred by affected industries, outside businesses supported etc.) I view Total Taxes.
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    IMPLAN Support
    Hi Victoria, Can you tell us what state you are working with, this will assist us in tailoring our response to your specific case. Thanks!
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    vdivino
    I am working with all states and at the national level actually. I am interested in the tax revenues (direct, indirect, induced) for one industry (as well as other industries affected by that industry) in particular. Thank you!
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    IMPLAN Support
    Hi Victoria, Great thanks, we apologize about the confusion. This is kind of a mixed questions that will likely require that you run the analysis both ways. By running the full value of Study Area Output for the region into the Industry Sales field, you can use the View By: Direct tax impact report to see what the total taxes paid by that industry are. But the View By:Total Tax impact report will actually be an overstatement of the taxes associated to this industries local production. You will be able to 'see' that by looking at the Detail Results for any of the economic measures for your industry. The Total Effect for your industry that you are Directly impacting will be larger than the regions total Output that you used for Industry Sales. That means that not only will the Indirect and Induced portions of the tax impact for this analysis overstate the tax contribution of your Directly affected industry, but it will also be overstating the tax impacts for all the feed back linkages associated to those additional purchases. To get a total tax impact you will want to use the contribution methodology. If you then want to show how much of the Direct is divided between each of these elements (Direct, Indirect, Induced)you can use the relative proportions for that Sector for Detailed Output to develop a ratio of Direct: Indirect: Induced by which to split the results of the "Direct Only" analysis described in the paragraph above. Hope this helps, Please let us know if you have any additional questions.
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    vdivino
    Thank you for the clarification! Actually I only need the total tax impact. I do not need to separate between total, indirect and induced. Can I clarify the methods for the contribution analysis? It is pretty clear from the paper at http://implan.com/v4/index.php?option=com_multicategories&view=article&id=660:660&Itemid=14 but I would just like confirmation: 1. Take output for the industry of interest (Can I confirm if this is direct output or is this total output? And is it ok to use my own sources or should I only use IMPLAN's output from the study area data?) 2. Take the Type 2 SAM multiplier for that industry 3. Divide 1.0 by the Multiplier from step 2 4. Multiply the output by the value calculated though step 3 5. Analyze a new activity for Industry Change. Enter the value calculated through step 4 as the Industry Sales. 6. Analyze a new scenario. Select the activity and analyze single region. 7. Take the total tax impact from the scenario results Can I confirm that this is the same methodology to use for all states as well as at the US level? Thank you for your help!
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    vdivino
    Hello, per the question above can you please clarify if the output reported in the study area data is direct or total?
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    IMPLAN Support
    Hi Victoria, 1. The Study Area Data Output value is the total value of production that industry production for that region. In regards to your using your own numbers, do the Output numbers you have represent the entire industry for your region, or just the value of your firm? If it is just the value of your firm, then we would recommend using the IMPLAN Study Area Data for the contribution analysis, portion, unless you want to constrict the analysis to have all Indirect and Induced purchases come exclusively from your firm. 2.Just as a check: For this step you need to use the Industry x Industry Multiplier, so this will not be the Multiplier that you see on the Summary Multipliers sheet, but rather the Multiplier from the "Detail Multipliers" spreadsheet with the "Choose By:" set to the industry that you are examining and then choose the line of the corresponding Sector (e.g. If you are doing a contribution analysis on Sector 99, the "Choose By: 99 Wood Windows and Doors Manufacturing" would be at the top of the screen and the SAM Multiplier for the row 99 would be the one you want use for your inverse calculation. 3.-6. These all look good based on what you have written. 7. Before pulling the tax impact, we would recommend verifying that the number entered for Industry Sales in step 5 was correct. This is easy to do. You will simply go into the Detail Results Tab> View By:Output and click on the Direct column header. This should sort the results so that the Sector from your Event comes to the top. The value reported as total should be nearly exactly what the Output value was prior to your making the adjustment to account for the Multiplier (For larger numbers some variance may be noted. Say Total Sector 99 Industry Output was $100,000,000, you might see that the reported Total for 99 as $99,999,989. Which when divided yields a difference of 0.000011%). Total tax impacts will then reflect the taxes associated to that level of industry production in the region. Hopefully this helps.
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    vdivino
    Thank you!! I have other sources for the Direct Output of the Industry, so I will use that. For 2. using, "Industry x Industry Multiplier". Can you tell me what the difference is between Detailed Multiplier and Summary multiplier? Can I confirm that if I want to calculate something like Total Output, I use the following calculation? Total Output = Direct Output + (Direct Output * (Summary Multiplier - 1)) ?
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    vdivino
    Actually, I'm not sure if I am clear on this, "The Study Area Data Output value is the total value of production that industry production for that region." Is that Output in the Study Area considered the Direct Output of that industry? Or does this value actually include indirect impacts as well? And if I want to calculate total output, that is done by: "Total Output = Direct Output + (Direct Output * (Summary Multiplier - 1)" ?
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    IMPLAN Support
    Hi Victoria. The Study Area Data Output value is the total value of production that industry production for that region. It does not include any include indirect or induced impacts.
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