Department of Finance and Administration Commissioner Larry Martin announced on Tuesday, that Tennessee tax revenue exceeded budgeted estimates for the month of June. Overall, June revenues totaled $1.4 billion, which is $31.4 million more than the state collected in June of 2017, and $31.3 million more than the budgeted estimate for the month.
“June reported revenues recorded positive gains compared to the budgeted estimate and were driven primarily by sales, corporate tax receipts, and privilege tax revenues,” Mr.
Martin said. “Sales tax receipts reflected strong growth compared to this time last year and were slightly more than the month’s estimate. Franchise and excise taxes were less than last year’s reported totals, but were in excess of the budgeted estimate for the month. All other tax revenues, taken as a group, were more than the June estimates.
“On a year-to-date basis, total reported revenues are now 2.68 percent more than the budgeted estimate and 2.30 percent more than the revised estimate set by the funding board in November 2017. The state is expected to exceed estimates at the end of the fiscal year, with one month remaining to be reported.”
On an accrual basis, June is the eleventh month in the 2017-2018 fiscal year.
General fund revenues were more than the budgeted estimates in the amount of $31.7 million, while the four other funds that share in state tax revenues were $0.4 million less than the estimates.
Sales tax revenues were $8.8 million more than the estimate for June and they were 5.21 percent more than June 2017. June sales tax revenues reflect retail business activity that occurred in May. For 11 months, revenues are $76.3 million higher than estimated. The year-to-date growth rate for eleven months was 4.33 percent.
Franchise and excise tax revenues combined were $11.4 million higher than the budgeted estimate in June, but the growth rate compared to June 2017 was negative 8.51 percent. For 11 months, revenues are $182.6 million more than the estimate and the year-to-date growth rate is negative 2.29 percent. However, adjusting for the one-time payments received last fiscal year and this fiscal year produces a positive underlying recurring year-to-date growth rate of 3.06 percent.
Gasoline and motor fuel revenues for June increased by 29.39 percent compared to June 2017, and they were $2.4 million more than the budgeted estimate of $96.7 million. For eleven months, revenues have exceeded estimates by $9.5 million.
Motor vehicle registration revenues $2.8 million less than the June estimate, and on a year-to-date basis, revenues are $19.0 million more than the estimate.
Tobacco tax revenues were $0.3 million more than the June budgeted estimate of $22.1 million. For eleven months, they are $8.3 million less than the budgeted estimate.
Inheritance and estate tax revenues were slightly less than the June estimate. On a year-to-date basis revenues for eleven months are $3.1 million less than the budgeted estimate.
Hall income tax revenues for June were $0.1 million less than the budgeted estimate. For 11 months, revenues are $28.9 million more than the budgeted estimate.
Privilege tax revenues were $5.8 million more than the June estimate, and on a year-to-date basis, August through June, revenues are $27.2 million more than the estimate.
Business tax revenues were $4.3 million more than the June estimate. For eleven months, revenues are $19.3 million more than the budgeted estimate.
All other tax revenues exceeded estimates by a net of $1.2 million.
Year-to-date revenues for eleven months were $352.5 million more than the budgeted estimate. The general fund recorded $308.1 million more than budgeted estimates and the four other funds $44.4 million.
The budgeted revenue estimates for 2017-2018 are based on the State Funding Board’s consensus recommendation of November 29, 2016 and adopted by the first session of the 110th General Assembly in June 2017. Also incorporated in the estimates are any changes in revenue enacted during the 2017 session of the General Assembly. These estimates are available on the state’s website at https://www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget-rev.html.
On Nov. 20, 2017, the Funding Board met to hear updated revenue projections from the state’s various economists. On November 27, 2017 the board adopted revised recurring revenue growth ranges for the 2017-2018 fiscal year. The current fiscal year’s revised ranges recognize growth in total taxes from a low of 2.43 percent to a high of 2.67 percent, and a general fund growth from a low of 1.16 percent to a high of 1.40 percent.
On April 19, 2018, in the second session of the 110th General Assembly, the legislature passed the 2018-2019 budget, which included the Funding Board’s current year revised ranges and also the administration’s amendment to the proposed budget. The governor signed the budget bill on June 21, 2018.
With the passage of the appropriations act, Public Chapter 1061, the General Assembly recognized in the current fiscal year an additional $49.7 million in total revenue and a corresponding increase in general fund revenue in the amount of $27.8 million.