NASHVILLE – State tax collections lagged slightly for May, with sales taxes continuing to underperform and corporate taxes posting a slight increase. Finance and Administration Commissioner Dave Goetz reported today that overall May revenues were $825.2 million or $14.2 million less than the state budgeted.
“May is a relatively small month for corporate collections, but it’s good to see that at least for the month, collections came close to the lower estimates set last month by the Funding Board,” Goetz said. “We will be looking to June, when a larger collection of business taxes are due, to see whether we are staying on track with the reduced budget.”
On an accrual basis, May is the tenth month in the 2007-2008 fiscal year.
The general fund was under-collected by $15.6 million, and the four other funds were over-collected by $1.4 million.
Sales tax collections were $5.4 million less than the estimate for May. The May growth rate was 1.20%. For ten months revenues are under-collected by $172.9 million. The year-to-date growth rate for ten months was 1.12 percent.
Franchise and excise taxes combined were $231,000 above the budgeted estimate of $47.5 million. For ten months revenues are under collected by $136.6 million.
Inheritance and estate taxes were $2.0 million above the May estimate. For ten months collections are $8.6 million above the budgeted estimate.
Tobacco tax collections were $1.0 million under the budgeted estimate of $29.8 million. For ten months revenues are under collected in the amount of $62.3 million.
Gasoline and motor fuel collections for May increased by 6.38 percent. For ten months revenues are over-collected by $11.4 million.
Year-to-date collections for ten months were $371.1 million less than the budgeted estimate. The general fund was under collected by $384.3 million and the four other funds were over collected by $13.2 million.
The budgeted revenue estimates are based on the State Funding Board’s consensus recommendation adopted by the first session of the 105th General Assembly in June of 2007. The revised estimates for this fiscal year as presented in the 2008-2009 Budget Document assume an under collection in total taxes in the amount of $165.4 million. The State Funding Board met on April 29 and May 1, 2008 and adopted revised revenue growth ranges for the current fiscal year ranging from 0.25% to 1.00% for total taxes, and -0.50% to 0.25% in general fund taxes. These ranges recognize a revenue shortfall in total taxes from the original budgeted estimates in the amount of $562.8 million at the low end to $479.9 million at the high end. The ranges for the general fund recognize a shortfall of $ 564.0 million at the low end to $494.5 million at the high end.