Coding error by Mississippi Department of Revenue alters Oxford’s October sales tax
Published 11:57 am Wednesday, January 6, 2021
The City of Oxford saw a massive drop in sales tax collection from September to October, and on Tuesday the City learned why.
The Mississippi Department of Revenue reported Oxford took in 42 percent less in sales tax in October than it did in September, marking one of the sharpest declines since the COVID-19 pandemic began in March.
During the regular Board of Aldermen meeting, Mayor Robyn Tannehill revealed why the decrease happened.
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According to Tannehill, Jessi Tolleson with the City Clerk’s office contacted the Department of Revenue and was informed an iternal audit at the MDOR’s office had been conducted, which revealed a vendor was coded to the City by mistake and should have been coded to the University of Mississippi.
“As we looked at other towns across the state, we saw that they had not experienced the same dip that we had (in October),” Tannehill said. “We didn’t think it could be possible for our revenues to be so much lower than the month prior.”
The mistake was found, and corrected, according to Tannehill, but it subtracted the entire amount from the December revenues to make the adjustment. The subtraction is what led to the large dip reported in October.
In a letter from Mark Gibbs, Deputy Director of Sales Tax with MDOR, to the City, Gibbs stated absent the audit activity, the payment would have been in line with the city diversion monthly average for Oxford.
“I think this is a great relief to us, and certainly will be to our citizens that our sales tax numbers were in line with our average month,” Tannehill said.
The audit also revealed the vendor in question had been coded erroneously for the past three years. Which vendor it was and the amount taken out as the result of the audit was not disclosed to the City by MDOR, according to Tannehill.
Each month, the MDOR reports sales tax diversions to each city for two months prior. January’s report, which will come out sometime later this month, will reflect sales tax collected in November.