Local Government Central

Taxable Sales Deflator Index

The California State Board of Equalization’s (BOE) taxable sales deflator (TSD) adjusts taxable sales amounts for inflation. In 2004 BOE took the position that TSD is more accurate than the Consumer Price Index (CPI) when adjusting for inflation in taxable sales.^[1] The California Integrated Waste Management Board’s (CIWMB) Adjustment Method Review Working Group and CIWMB staff reviewed TSD and recommended the Board allow the use of the Taxable Sales Deflator Index (TSDI) instead of CPI. At its September 2005 meeting, the Board directed staff to allow the use of TSDI as an acceptable alternative beginning with 2004 jurisdiction annual reports.^[2] In August, 2006, the Board directed staff to use TSDI to calculate the statewide diversion rate.^[3]

The Board converts TSD to TSDI to allow comparison of nonadjacent years such as 1990 and 2005.

Taxable Sales Deflator Index (TSDI) Frequently Asked Questions

^[1] Economic Perspective: Summary of Recent Economic Developments, pp. 2-4, “California Taxable Sales Deflator Shows Low Inflation,” February 2004, State Board of Equalization, accessed September 30, 2005.

^[2] September 20, 2005 Board Meeting, Agenda Item 13, “Discussion And Request For Direction Regarding The 2004/2005 Adjustment Method Review Working Group Recommendations."

^[3] August 15, 2006 Board Meeting, Agenda Item 12, "Discussion And Request For Direction Regarding Options For Calculating The 2005 Statewide Diversion Rate."

Adjustment Method Factors

Last updated: February 07, 2008