WARREN REVENUE Income tax coffers grow 5% over 2004

Last year's city income tax collections were up $1,022,018 from 2004.
WARREN -- Bolstered by strong corporate profits, city income tax collections in 2005 totaled $19,846,426 -- more than 5 percent above 2004's total.
The strongest segment was the corporate net profits tax, where receipts rose 66 percent to $2,389,181.
Second-strongest was the individual accounts segment, which consists of self-employed people and others whose city income tax isn't withheld from their paychecks.
Receipts from this segment rose almost 15 percent to $2,350,535.
"That number is determined by the aggressiveness of the income tax office," in collecting revenue, said John Taylor, former city treasurer.
But Taylor said he found it "troubling" that the segment derived from withholdings from employees' paychecks dropped 1.5 percent to $15,106,710.
Third year of decine
Last year was the third consecutive year of decline in receipts from the withholding segment, which accounts for some 77 percent of all city income tax collections.
Taylor, who left office Saturday and was succeeded by John Homlitas, said the decline in the payroll withholding segment of collections would likely continue in 2006 as more people retire.
The city levies a 2 percent tax on wages, salaries, commissions, fees, bonuses, tips, lottery winnings, net rental income and corporate net profits. But it doesn't tax retirement income or interest, dividends or capital gains income.
Taylor warned that the corporate net profits segment is unpredictable from year to year.
The strong corporate showing in 2005 was attributable to locally based companies, including steel-related businesses, that have customers elsewhere in the country where the economy has been performing well.
Aggressive
During his term, Taylor said the tax office was aggressive in finding those who should be paying city income tax through cross matches with state income tax and city water department records and other sources and in collections through municipal court action.
But Taylor concluded: "I still think there's some money out there that we haven't been able to collect. And I think the programs that we have in place, over time, will sniff that income out."