The February tax revenue report again shows broad year-over-year gains to include an almost 15% increase in statewide sales and use tax revenue – a sign that consumer spending appears to be robust.
The Arkansas Department of Finance and Administration (DFA) reported Tuesday (March 2) that gross revenue for fiscal year-to-date (July 2020 to February 2021) is $4.913 billion, up 8.4% compared with the same period in 2019-2020 and up 11.6% over the budget forecast. Part of the gain includes a shift in collections when the 2020 tax due date was moved from April to July, according to the DFA report.
Tuesday’s report also showed a fiscal year-to-date revenue surplus – “net available revenue” collected beyond what was estimated – of $529.1 million.
Individual income tax revenue was $2.411 billion in the first eight fiscal months, up 8.4% compared to the same period in 2019-2020 and up 11.8% over the budget forecast. Sales and use tax revenue – an indicator of consumer spending – during the first eight months was $1.851 billion, also up 8.4% compared with the same period in 2019 and up 9.2% above budget forecast.
“Among major collection categories, Sales Tax collections continue to exceed forecast and display high growth compared to year ago levels and trend average,” John Shelnutt, DFA director of economic analysis and tax research, noted in a memo with the February report.
Corporate income tax revenue during the first eight months of the fiscal year was $320.1 million, up $41.2 million compared with the same period in 2019-2020, and up 26.1% from the budget forecast.
Gross revenue in the month totaled $493.6 million, down 1.6% compared with February 2020, and 6.9% above the forecast.
Individual income tax revenue totaled $238.3 million in February, down 12.2% compared with February 2020, and 1.4% above the forecast. The decline is largely attributed to late e-filing of taxes resulting from tax law changes approved in December by Congress, according to the DFA report.
Sales and Use tax revenue in February totaled $221.8 million, up 14.9% compared with February 2020 and up 16.4% above the forecast. Corporate income tax revenue was $5.3 million in February, down $2.8 million compared with February 2020, and $4.2 million 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
July-February 2020: $147.4 million
July-February 2019: $143.8 million
July-February 2020: $43.8 million
July-February 2019: $40.1 million
Games of skill
July-February 2020: $21 million
July-February 2019: $24.3 million
July-February 2020: $48.2 million
July-February 2019: $48.4 million