Arkansas revenue officials said the state’s first month of its fiscal year saw an increase in corporate and sales tax revenue, while individual income taxes were off the mark.
July net available general revenues – the amount after mandatory earmarks are accounted for – totaled $410.2 million, a 1.6% increase over last July and 1.9% above forecast.
“Results in July were mixed, as Individual Income tax fell slightly below forecast, Corporate Income tax and Sales tax slightly exceeded, and income tax refunds contributed to gains by detracting from revenue growth less than expected,” said John Shelnutt, economist and chief of the Department of Finance and Administration’s Economic Analysis and Tax Research division.
“Monthly timing factors contributed to the mixed pattern, as individual withholding was below forecast and below year ago results. Payday timing effects on collections cause monthly swings and added volatility that is not present in the Official Annual Forecast. It is a short-term factor for collections,” Shelnutt added.
He also said sales and use tax collections “were encouraging” at 4.5% growth compared to last year. The results include high growth from the motor vehicle portion of sales tax, he said.
DF&A provided the following data and analysis related to the major revenue categories that account for nearly 90% of total state tax revenues:
- July Individual Income Tax collections totaled $206.0 million. Collections decreased by $6.2 million, or -2.9 percent compared to last year. With respect to the forecast, collections were $1.5 million or -0.7 percent below forecast. Individual withholding declined -3.8 percent compared to last year, as a result of monthly payday timing differences.
- July Sales and Use Tax Collections totaled $186.0 million, an increase of $8.1 million or 4.5 percent from last year. Collections were also above monthly forecast levels by $1.0 million or 0.5 percent.
- July Corporate Income Tax collections totaled $26.9 million, an increase of $1.0 million from year ago, and $0.5 million or 1.9 percent above forecast.
You can read the full report here.