With just two months remaining in Arkansas’ fiscal year, tax revenue is on track to beat the record collections in the previous fiscal year. Also, the state’s revenue surplus was $430.1 million at the end of April.
Tax revenue in the first 10 fiscal months of the year (July 2022-April 2023) totaled $7.313 billion, up 1.2% compared with the same period in the previous fiscal year and up 5.1% over the forecast, according to a report posted Tuesday (May 2) by the Arkansas Department of Finance and Administration (DFA).
Individual income tax revenue in the first 10 months of the fiscal year was $3.352 billion, down 5% compared to the same period in 2021-2022, and 3.2% above the budget forecast. Sales and use tax revenue in the first 10 months was $2.814 billion, up 7.9% compared with the same period in the previous fiscal year and up 2.2% above the forecast. Corporate income tax revenue in the first 10 months was $712 million, up $53.3 million compared to the same period in 2021-2022, and 32.7% above the forecast.
“Individual Withholding Tax revenue increased 2.9 percent compared to last year. Growth in Withholding Tax collections in April combined the positive effects of a payday timing factor counted in April collections in lower ongoing withholding rates tied to recent tax reduction,” John Shelnutt, DFA administrator of economic and tax research, noted in Tuesday’s report.
APRIL COLLECTIONS
Tax revenue in April totaled $1.121 billion, down 15.5% compared with April 2022, and up 6.3% compared with the budget forecast.
April individual income tax revenue was $603.3 million, down 25.6% compared with April 2022 and 0.1% below the forecast. April sales and use tax was $287.8 million, up $16.3 million compared with April 2022, and 1.9% above forecast. Corporate income tax revenue in April was $198.2 million, down $11.8 million compared with April 2022 and $62.1 million above forecast.
“April is a critical month for income tax collection and refund claims. We passed the test in good shape with $123 million above forecast overall,” Larry Walther, secretary of the Arkansas Department of Finance and Administration, said in a statement.
Total tax revenue in fiscal year 2022 (July 2021-June 2022) was $8.773 billion, up 8% – or $651.2 million – compared with a robust fiscal year 2021 in which the tax surplus was $945.7 million. State tax coffers ended the previous fiscal year in June with a $1.62 billion surplus.
OTHER REVENUE SOURCES
Tobacco
July 2022-April 2023: $170.1 million
July 2021-April 2022: $178.9 million
Insurance
July 2022-April 2023: $82.1 million
July 2021-April 2022: $76.9 million
Alcoholic beverages
July 2022-April 2023: $60.5 million
July 2021-April 2022: $59.4 million
Games of skill
July 2022-April 2023: $43.4 million
July 2021-April 2022: $36.4 million
