State Tax Revenues Soar During April

Georgia’s tax revenues increased 24.2% during the month of April when compared by the same month one year ago, according to a press release from Governor Kemp’s office this morning. Income taxes made up most of the difference.

The strong revenue performance for April means that the budget for FY 19, which ends June 30th, will likely be met in full. Those that watch the revenues and budgets closely are already looking ahead to next year with more skepticism than usual. Georgia’s income tax cut combined with an increase in salaries for teachers (and related increased contributions for retirement systems) will leave little room for error in the FY 2020 budget, requiring a continued growing state economy to meet the budget without dipping into reserves.

For now, however, Georgia appears to have scored another year of fully funding QBE, balancing a budget, and having approximately $2.5 Billion in reserve for a rainy day. The full press release is as follows:

Atlanta, GA – Georgia’s April net tax collections totaled $2.87 billion for an increase of $559.7 million, or 24.2 percent, compared to April 2018 when net tax collections totaled $2.31 billion. Year-to-date, net tax collections totaled $19.91 billion for an increase of almost $939.7 million, or 5 percent, compared to the previous fiscal year when net tax revenues totaled $18.97 billion.

Changes in the following tax categories explain April’s net tax revenue increase:

Individual Income Tax: Individual Income Tax collections totaled over $1.58 billion for an increase of $454.6 million, or 40.3 percent, compared to last year when Income Tax collections totaled nearly $1.13 billion.

These components within Individual Income Tax combine for the net increase:

▪ Individual Income Tax refunds issued (net of voided checks) declined by $40 million, or -6.5 percent.

▪ Individual Income Tax Return payments increased by $307.2 million, or 48.9 percent, compared to last year.

▪ Individual Withholding payments for the month were up $70.7 million, or 7.9 percent.

▪ All other categories, including Non-Resident income tax payments, increased a combined $36.7 million.

Sales and Use Tax: Gross Sales and Use Tax collections totaled just over $1.1 billion in April, which was an increase of $73.5 million, or 7.1 percent, over April 2018. Net Sales and Use Tax increased by roughly $30.5 million, or 5.6 percent, over last fiscal year when net sales tax totaled $544.1 million. The adjusted Sales Tax distribution to local governments totaled $524.8 million for an increase of $43.3 million, or 9 percent, over last year. Lastly, Sales Tax Refunds declined by roughly $0.3 million, or -7.1 percent, compared to FY 2018.

Corporate Income Tax: Corporate Income Tax collections totaled $310.4 million for an increase of $69.2 million, or 28.7 percent, over last year when corporate tax collections totaled $241.2 million.

These components within Corporate Income Tax comprise the net increase:

▪ Corporate Income Tax refunds (net of voids) increased by $1.1 million, or 5.4 percent over last year.

▪ Corporate Income Tax Estimated payments received were up $57.9 million, or 43.8 percent.

▪ Corporate Income Tax Return payments increased by $7.7 million, or 6.5 percent.

▪ All other Corporate Tax types, including S-Corp tax payments, were up a combined $4.7 million.

Motor Fuel Taxes: Motor Fuel Tax collections fell nearly $1.2 million, or -0.7 percent, compared to FY 2018.

Motor Vehicle – Tag & Title Fees: Motor Vehicle Tag & Title Fees increased by $2.2 million, or 6.1 percent, in April while Title Ad Valorem Tax (TAVT) collections declined by $2.7 million, or -3.6 percent, compared to FY 2018.

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Benevolus
Benevolus

Enjoy it while we can. HB481 likely to send a bit of that growth back to from whence it came.