Tennessee State Collections Had Record Growth In July, But Less Than Budgeted

Thursday, August 14, 2014

Tennessee revenue collections recorded positive growth in July, but still came in less than the state budgeted. Finance and Administration Commissioner Larry Martin Thursday announced a net positive growth of 2.39 percent over July collections of one year ago. Overall July revenues were $941.8 million, which is $3.2 million less than budgeted.

“We've recorded positive sales tax collection growth every month in this fiscal year, but the economic recovery is slow,” Commissioner Martin said.  “We’ll begin to close out the fiscal year next month, when we report sales tax collections for August, which will reflect spending that occurred in July.

“Although July is a relatively small month for corporate taxes, we saw slight growth over prior year collections.  We’ll continue to closely examine corporate collections as we transition into a new fiscal year.” 

The general fund was over collected by $1.2 million, and the four other funds were under collected by $4.4 million.

Sales tax collections were $1.3 million more than the estimate for July.  The July growth rate was 3.17 percent. For 12 months revenues are under collected by $14.2 million. The year-to-date growth rate for twelve months was positive 3.53 percent.

Franchise and excise taxes combined were $2.2 million below the budgeted estimate of $70.7 million. The growth rate for July was positive 2.92 percent. For 12 months revenues are under collected by $280.5 million and the year-to-date growth rate was negative 8.42 percent.

Inheritance and estate tax collections were $2.0 million above the July estimate. For 12 months collections are $21.9 million above the budgeted estimate.

Privilege tax collections were $0.7 million below the July budgeted estimate. For 12 months collections are $23.7 million less than the budgeted estimate, and the year-to date growth rate was positive 1.64 percent.

Business tax collections were $0.6 million less than the July estimate. Year-to-date collections for 12 months are $10.8 million below the budgeted estimate.

Tobacco tax collections were $0.6 million above the budgeted estimate of $24.3 million. For 12 months revenues are under collected by $12.7 million.

Gasoline and motor fuel tax collections for July were over collected by $0.1 million. For 12 months revenues are over collected by $4.9 million, and the growth rate is positive 0.78 percent.

All other taxes for July were under collected by a net of $3.7 million. 

Year-to-date collections for 12 months were $293.1 million less than the budgeted estimate. The general fund was under collected by $302.4 million and the four other funds were over collected by $9.3 million.

The budgeted revenue estimates for 2013-2014 are based on the State Funding Board’s consensus recommendation of Dec. 19, 2012 and adopted by the first session of the 108th General Assembly in April 2013. They are available on the state’s website athttp://www.tn.gov/finance/bud/Revenues.shtml.

The Funding Board met on Dec. 10, 2013 to hear updated revenue projections from the state’s various economists. The board met again on Dec. 17 and adopted revised revenue ranges for 2013-2014. The revised ranges assume an under collection from the July 2013 budgeted estimate in the amount of $111.2 million to $134.5 million in total taxes and in the amount of $126.1 million to $145.6 million in general fund taxes for the current fiscal year.

Year-to-date collections for 2013-2014 are subject to final accrual adjustments.

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