TN Exceeds Estimates, Collects $1.8B In January Taxes, Fees
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The Center Square [By Jon Styf] –
Tennessee collected $300 million more in taxes and fees than budgeted in January, according to the Tennessee Department of Finance and Administration.
January’s total means that the state has now collected $1.94 billion more than budgeted for the first six months of the fiscal year, which is accounted for on an accrual basis from August to July.
“Total tax growth for the month January was strong, however it was notably less than the near 22 percent growth the state experienced in the first five months of this fiscal year,” Department of Finance and Administration Commissioner and Deputy Governor Butch Eley said said. “Monthly growth from sales tax receipts, reflecting consumer spending during the December 2021 Christmas shopping season, remained resilient though a large part of the growth was most likely attributable to price inflation on goods sold.”
A large portion of the overage came from state sales tax, where Tennessee collected $179 million more than estimated for the month and $1.1 billion over year-to-date fiscal year estimates. The year-to-date growth rate for sales tax is 18%.
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“Moving forward through the final six months of the fiscal year, we expect growth rates to be appreciably lower,” Eley said. “Growth from out-of-state online sales tax receipts should moderate; additional extraordinary federal stimulus does not appear likely; and, a shift in consumer spending patterns largely from goods to more services will provide a headwind to additional sales tax growth for the state.
“As such, we will continue to closely monitor our revenues and expenditures throughout the remainder of this fiscal year.”
Gov. Bill Lee’s proposed budget includes an estimated $2.3 billion in surplus for this fiscal year, which is similar to the surplus from last fiscal year.
Tennessee collected $1.8 billion in taxes and fees in January. Franchise and excise tax revenues were $89.8 million higher than estimates for the month, and privilege tax collections were $27.2 million more than estimates.
Gas and fuel taxes ($5 million more than estimated), mixed drink taxes ($5 million), tobacco taxes ($2.5 million) and business taxes ($2.1 million) all exceeded estimates by more than $2 million. Vehicle registrations were $1.5 million more than estimated.
About the Author: Jon Styf, The Center Square Staff Reporter – Jon Styf is an award-winning editor and reporter who has worked in Illinois, Texas, Wisconsin, Florida and Michigan in local newsrooms over the past 20 years, working for Shaw Media, Hearst and several other companies. Follow Jon on Twitter @JonStyf.
