Arkansas tax revenue up 3.2% in January; surplus nears $195 million

Another month, another similar growth story with Arkansas’ tax revenue. Total revenue in the January report was $807 million, up 3.2% compared to what was a healthy January 2022, and up 9.6% above the budget forecast.

In the January revenue report posted Thursday (Feb. 2) by the Arkansas Department of Finance and Administration said “results were above forecast in all major collection categories.”

Year-to-date (July 2022-January 2023) tax revenue was $4.952 billion, up 5.9% compared with the same period in the previous fiscal year.

Individual income tax revenue in the first seven months of the fiscal year (July-January) was $2.21 billion, up 3.2% compared to the same period in 2021, and 4% above the budget forecast. The report said the net available revenue – surplus – at the end of the first seven months was $194.8 million.

Sales and use tax revenue in the first seven months was $1.984 billion, up 8.8% compared with the same period in 2021-2022 and up 1.9% above the forecast. Corporate income tax revenue in the first seven months was $443.7 million, up $42.5 million compared to the same period in 2021-2022, and 20.1% million above the forecast.

“Most major reporting sectors of Sales Tax displayed high growth over the prior year, reflecting continuing economic expansion in many sectors,” John Shelnutt, DFA administrator of economic and tax research, noted in Thursday’s report. “The Retail sector within Sales Tax collections had lower growth after a 25 percent gain reported last January. Motor vehicle sales tax collections were up 10.2 percent from year ago January.”

January individual income tax revenue was $441.7 million, down 0.9% compared to January 2022 and 13.3% above forecast. January sales and use tax was $294 million, up 9.4% compared with January 2022, and 5.7% above forecast. Corporate income tax revenue in January was $36.7 million, up $7.6 million compared with January 2022 and $4.8 million above forecast.

Total tax revenue in fiscal year 2022 (July 2021-June 2022) was $8.773 billion, up 8% – or $651.2 million – compared with a robust fiscal year 2021 in which the tax surplus was $945.7 million. State tax coffers ended the previous fiscal year in June with a $1.62 billion surplus.

OTHER REVENUE SOURCES
Tobacco
July-January 2022: $120.9 million
July-January 2021: $129.3 million

Alcoholic beverages
July-January 2022: $43.3 million
July-January 2021: $42.6 million

Games of skill
July-January 2022: $27.4 million
July-January 2021: $24.4 million

Insurance
July-January 2022: $53.6 million
July-January 2021: $49.8 million