John Schroder
Crude oil prices over $100 a barrel will mean more money for the state’s general fund as Louisiana benefits from higher-than-expected revenues from severance taxes and royalties. But State Treasurer John Schroder said any increase in revenue from oil and gas production could be offset in a loss of sales tax revenues…
“Where we might get more money in revenue when it comes to goods and services, now we’re going to lose it on the backend with the consumption tied in,” said Schroder.
According to the January forecast from the Revenue Estimating Conference, the state will collect $525.5 million in total mineral revenues for the 2023 fiscal year.
But Schroder said for those who live on a fixed income, they will cut back on other spending so where the state might see more oil and gas revenues, for example, sales tax collections will most likely go down.
“Hey look, I’m not the economist, I’m just a banker, but you’ll see an uptick in that area but you’re going to see a downtick in others,” said Schroder.
And while Schroder said it’s a pretty safe bet that gas prices are not going to decrease anytime soon, he said because of that Louisianans will be changing their spending habits due to prices at the pump and elsewhere.
“If you’re on a fixed income, then all of the sudden you’re paying $18 for a burger where it used to be $10. Now you’re not going out to eat, you’re not traveling as far, you’re not going to go on vacation very far,” said Schroder.
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