Friday, November 09, 2018
NOTES FROM THE SENATE, NOVEMBER 9, 2018
OCTOBER REVENUES TOP LAST YEAR
October revenues came in at an eye-popping 17.7% increase. Looking back, October of a year ago was negative due to a substantial number of refunds that were released in that month. So it is no surprise that October of 2018 would show a big increase. Some analysts are saying the prospects for continued growth at these high levels will come to a screeching halt in January when new withholding rates will reflect the doubling of the individual deduction tied to the tax cut passed last Session.
CONTINUED INCREASE FOR INDIVIDUAL INCOME TAXES IN OCTOBER
Individual Income Taxes increased 17.2% for October on revenues of $1.051 billion, a gain of $154.1 million. Refunds were down -5.6% or -$9 million while Individual Withholding payments increased $108.2 million or 11.8%.
Individual Income Tax Return payments grew $35 million for the month. Other categories were up $1.9 million. Corporate Income Taxes were up $64.6 million.
NET SALES TAXES REMAIN STRONG
Continuing their recent persistent increase, net sales taxes were up 9.4% on revenues of $525.1 million. Sales Tax gains continue to track national retail sales growth.
OTHER CATEGORIES- SOMEWHAT MIXED
Tobacco taxes were up at 17.9% while Alcohol Beverages decreased -16.3%. Tag, Title and Fees were up slightly down at -1.9% but Title Ad Valorem taxes were up at 1.4%.
TRANSPORTATION GASOLINE TAXES/FEES UP 2.2% FOR OCTOBER
We track the excise taxes on motor fuel and the two fees since those revenues go straight to DOT. This month, Excise Taxes were up 2.6%, Highway Impact Fees increased $89,000 and Motel/Hotel Fees decreased -$242,000. Altogether Motor Fuel taxes and fees were up $3.6 million or about 2.2%.
YEAR TO DATE NUMBERS ALL VERY POSITIVE
Overall, the state appears strong and stable at 8.8% revenue gain. Total revenues stand at $7.8 billion, showing an increase of an impressive $632.4 million. Individual Income Taxes are growing at 10.1% and Corporate Taxes at 38.7% ahead of this same time last year. Net Sales Taxes are showing a very strong 7.7% increase.
OTHER CATEGORIES TRENDING DOWN
Tobacco Taxes are now ahead 2.8% and Alcoholic Beverages are negative at -2.9%. Tag, Title and Fees are slightly negative at -1.0% and Title Ad Valorem Taxes are also negative at -7.7%.
FUEL TAX REVENUE STRONG AS WELL
Motor Fuel Excise taxes, Impact Fees and Hotel/Motel Fees are all up for the first quarter, a total of $686.7 million. This is an increase of $19.7 million or about 3.0%.
AHEAD OF BUDGET---THE IMPORTANT THING
The state's revenue increases are meeting and exceeding the budget passed during the 2018 Session. After four months of the fiscal year, revenues exceed the state's 2019 budget by some $446.5 million. Of course some of that will be re-examined and likely to change when the Special Session begins November 13th to address the devastation brought Hurricane Michael to west Georgia.
GEORGIA STANDING STRONG
The state's 12-month trailing average through October has now hit an impressive 6.8%. While states continue to report in their October revenues, the few states that have reported have interesting budget situations.
Texas started their new fiscal year in September and is preparing to work on their biennial budget in their upcoming session. Texas' overall receipts are actually negative, -2.0%, for the four months of this fiscal year. Texas' 12 month trailing average, however, is a 9.7% gain. Another early reporting state, Arkansas is up 12-month trailing at 4.4% and their year-to-date figures show a healthy 6.4% gain.