Arkansas’ gross tax revenue up almost 12% for the fiscal year

Gains in retail and vehicle sales, along with a shift in individual income tax payments, continue to show up in Arkansas tax revenue that beats estimates. For the first five fiscal months (July-November), gross revenue is up almost 12% compared with the same period in 2019.

The Arkansas Department of Finance and Administration (DFA) reported Wednesday (Dec. 2) that gross revenue for fiscal year-to-date is $3.092 billion, up 11.9% compared with the same period in 2019 and up 11% over the budget forecast.

Wednesday’s report also showed a fiscal year-to-date revenue surplus – revenue collected beyond what was estimated – of $283.3 million.

Individual income tax revenue was $1.521 billion in the first five fiscal months, up 15.5% compared to the same period in 2019 and up 10.6% over the budget forecast. Sales and use tax revenue – an indicator of consumer spending – during the first five months was $1.162 billion, up 9.1% compared with the same period in 2019 and up 9.8% above budget forecast.

John Shelnutt, DFA director of economic analysis and tax research, credited some of the gain to car sales and retail sales and because of the income tax deadline shift from April to July.

Corporate income tax revenue during the first five months of the fiscal year was $173.2 million, up $15.1 million compared with the same period in 2019, and up 20.1% from the budget forecast.

NOVEMBER REVENUE
Gross revenue in the month totaled $533.5 million, up 3.6% compared with November 2019, and 6.3% above the forecast.

Individual income tax revenue totaled $252.5 million in November, up 3.3% compared with November 2019, and 9.9% above the forecast. Sales and Use tax revenue in November totaled $219.6 million, up 2.6% compared with November 2019 and up 3% above the forecast. Corporate income tax revenue was $8.4 million in November, up $3.6 million compared with November 2019, but 17.3% below the forecast.

The previous fiscal year (July 2019-June 2020) ended with $369.4 million in net available revenue more than expected. Fiscal year 2020 tax revenue ended down just 2.5% despite several months in early 2020 of economic disruption resulting from COVID-19 shutdowns. The revenue was 4.1% above the revised forecast. Gross revenue in the previous fiscal year was $6.967 billion, 2.5% below fiscal year 2019, but up $272.5 million more than the forecast.

OTHER REVENUE SOURCES
Tobacco
July-November 2020: $96.5 million
July-November 2019: $91.8 million

Alcoholic beverages
July-November 2020: $28.5 million
July-November 2019: $25.7 million

Games of skill
July-November 2020: $12.8 million
July-November 2019: $16.3 million

Insurance
July-November 2020: $43.6 million
July-November 2019: $44.9 million