State tax revenue totaled $3.324 billion in the first five months (July-November) of the fiscal year, down 1.4% compared with the same period in 2022, and up 5.6% against the budget forecast.
The state’s surplus – net available revenue above forecast – at the end of November was $144.1 million, according to a report posted Monday (Dec. 4) by the Arkansas Department of Finance and Administration (DFA).
Income tax revenue in the first five fiscal months was $1.436 billion, down 2.9%% from the same period in 2022 and 6.4% above forecast. Sales tax revenue in the first five fiscal months was $1.449 billion, up 3.1% above the same period in 2022 and 2.9% above the forecast. The corporate income tax in the first five months was $207.2 million, down $48.2 million compared with the 2022 period and $32.8 million above the forecast.
“Net Available revenue results were above forecast in all major collection categories. Individual Income Tax gains were driven largely by non-Withholding Tax categories. Corporate Income Tax collections were above forecast with higher Estimated Payments. Sales Tax collections were above forecast and year-ago levels with broad-based gains,” John Shelnutt, DFA administrator of economic and tax research, noted in the report.
NOVEMBER COLLECTIONS
Total revenue in November was $606.6 million, up 4.4% compared with November 2022, and 4.9% above forecast. Individual income tax revenue in November was $247.6 million, up 0.8% compared with November 2022, and 2.7% above the budget forecast.
Sales and use tax revenue was $287.2 million, up 6.8% compared with November 2022 and 6.3% below the forecast.
“Collections were above monthly forecast levels by $17.0 million or 6.3 percent. Major reporting sectors of Sales Tax displayed mostly higher growth over the prior year, reflecting continuing economic expansion in many sectors. Motor vehicle sales tax collections were up 14.6 percent from year-ago November,” Shelnutt noted.
Corporate income tax revenue was $12.2 million, up $2.2 million compared with November 2022 and $3.4 million above the forecast.
Arkansas ended the previous fiscal year (November 2022-June 2023) with a $1.161 billion tax revenue surplus driven in large part by a more than 8% growth in sales tax collections. Total tax revenue in the fiscal year (November 2022-November 2023) was $8.85 billion, up 0.9% compared with the previous fiscal year and 1.7% more than the budget forecast.
The fiscal year surplus of $1.161 billion was the third consecutive year of a surplus of near or more than $1 billion. Total tax revenue in fiscal year 2022 (November 2022) was $8.773 billion, up 8% – or $651.2 million – and the budget surplus was $1.628 billion. The surplus in the fiscal year that ended June 2021 was $945.7 million.
