Strong March Collections Lift State Revenues

If March came in like a lamb, it left like a lion.

Arkansas tax officials released the March revenue report, which showed an 11.6% increase in net revenues versus the previous year. March marks the end of the third quarter for the state’s current fiscal year.

“All major categories of collections were above forecast in gross revenue terms and lower-than expected refunds provided an extra gain in net available funds,” said John Shelnutt, director of the state’s Economic Analysis & Tax Research division at the Department of Finance and Administration. “The monthly swing largely offsets the weakness in the prior month and adds to year-to-date gains going into the largest, and potentially volatile collection month of April.”

Shelnutt said results were significantly impacted by:

A rebound in Sales and Use tax compared to year ago and versus forecast;
Components of Individual Income tax compared to forecast; and
A decline in both individual and corporate refunds compared to forecast and year ago refunds.

Most smaller revenue categories exceeded forecast except Tobacco tax collections, which were down sharply.

Year-to-date net available general revenues total $3.59 billion, 2.7 percent above year ago levels and 2.2 percent above forecast.

Other year-to-date revenue categories showed:

Year-to-date Sales and Use Tax Collections: On a year-to-date basis, sales and use taxes total $1.63 billion, an increase of three percent from FY 2013 and one percent below forecast.

Year-to-date Individual Income Taxes: Year-to-date individual income tax collections totaled $2.15 billion, 3.1 percent above FY 2013 collections and 2.1 percent above forecast. Collections for individual withholding are up 2.9 percent from year ago levels.

Year-to-date Corporate Income Taxes: Year-to-date corporate revenues totaled $305.8 million, an increase of 3 percent from year-to-date FY 2013. Corporate income is above forecast by 4.5 percent.