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December General Fund receipts decline 4.1 percent from a year ago; Road Fund receipts up 4.2 percent

The state budget director reported Friday that December’s General Fund receipts totaled $1,084.3 million, a 4.1 percent decline compared to December of last year.

Receipts have increased 2.7 percent for the first six months of the fiscal year that ends June 30, 2020. Second quarter collections rose 4.1 percent, which is an improvement over first quarter collections which rose 1.1 percent.

The official fiscal year 2020 General Fund revenue forecast, which was revised by the Consensus Forecasting Group on Dec. 17, calls for a 1.6 percent revenue growth. Revenues would need to grow 0.6 percent for the last six months of the fiscal year to meet the estimate.

State Budget Director John Hicks noted that the decline in General Fund receipts was impacted by the timing of the receipt of individual income withholding collections.

John Hicks

“The individual income tax fell 9.4 percent in December after strong gains of 14.1 percent in November,” Hicks said. “This month-to-month volatility is typical for the holiday period due to the way calendars fall and tax collections post. Another factor that tamped down December collections was a multi-year refund disbursement of $21.7 million from the corporate income tax account.

“On a positive note, we expect to see a bump in January sales tax collections because many of the busiest shopping days of the year fell in early December, which means the tax revenue will show up in January collections. Overall, we will have a much more complete picture of the three-month holiday season after January receipts have posted and timing issues have worked its way through.”

Among the major accounts:

• Sales and use tax receipts rose 2.6 percent in December and have increased 6.3 percent for the year.

• Corporation income tax receipts fell 36.8 percent for the month due to the large refund and declarations and net returns were lower. Corporation income tax receipts are down 16.5 percent for the year. The limited liability entity receipts are up 26.2 percent for the year.

• Individual income tax collections declined 9.4 percent in December due primarily to a 10.4 percent decline in withholding. Year-to-date collections in this account have increased 2.0 percent.

• Property tax collections fell 4.5 percent but are up 0.3 percent for the year.

• Cigarette tax receipts increased 22.0 percent in December. For the first six months of the year collections have increased 1.5 percent.

• Coal severance tax receipts decreased 5.0 percent in December but have fallen 18.6 percent for the year.

Road Fund receipts for December totaled $122.0 million, a 4.2 percent increase from December 2018 levels. Year-to-date receipts have increased 1.1 percent. Collections in this fund have been consistent through the first half of the fiscal year, having increased 1.1 percent in both the first and second quarters.

The official Road Fund revenue estimate calls for a 0.4 percent increase for the fiscal year. Revenues can decline 0.2 percent over the remainder of the fiscal year and still meet the fiscal year 2020 estimate.

Among the accounts, motor fuels receipts grew 1.2 percent in December, and are up 0.7 percent for the first six months. Motor vehicle usage revenue rose 10.7 percent in December and has increased 4.9 percent year-to-date. License and privilege receipts increased 2.5 percent for the month but are down 6.9 percent for the year.

From Office of State Budget Director

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