Boosted by strong gains in individual income taxes and sales taxes, Arkansas’ April revenue report improved by 5.1% over last year and landed 5.9% above forecast.
The Arkansas Department of Finance and Administration report showed net available general revenues totaled $558.9 million for the month.
“Among major revenue categories, Individual Income and Sales Tax (gross receipts) came in substantially above forecast and year ago levels in April. Individual income tax accounted for the bulk of the gain in both dollar and percentage terms compared to forecast and year ago measures,” noted John Shelnutt, director of DF&A’s Economic Analysis & Tax Research division.
Ten months into the state’s fiscal year, which ends June 30, total net revenue collections topped $3.9 billion. That figure is 3.2% ahead of the same time period last year and 2.5% above expectations.
For the full year, individual and corporate income taxes are ahead of last year’s collection rates and forecasts, while gross receipts are below forecast but above year-ago levels.
Shelnutt noted that gross receipts, which include sales and use taxes – a strong signal of consumer spending – were improving, but still remained lackluster.
“The sales tax results improved again in April relative to forecast, but year-to-date results reflect a combination of generally weak retail sales earlier in the fiscal year and adverse one-time comparisons in business transactions in the first two months of the fiscal year,” he said.
Shelnutt also said that potential volatility in income tax refunds may be abated for the time being.
“Although high volatility was recorded in individual income tax refunds during the tax filing season, significant risk from refunds appears to have passed,” he said.