April 02, 2018 | Revenue & Economic Update
In December, the Independent Fiscal Office (IFO) released an update of the fiscal year (FY) 2017-18 official revenue estimate (originally published in June 2017) and corresponding revised monthly projections.1 Through March, total General Fund revenues are $498 million, or 2.0 percent, above the IFO’s updated official estimate.
For the month of March, General Fund collections were $121 million (-2.7 percent) below estimate. Overall sales and use tax revenues exceeded estimate by $17 million, with a small shortfall in motor vehicle receipts (-$6 million) more than offset by an overage in non-motor collections ($22 million).
Corporate net income tax payments were below estimate by $80 million (-15.8 percent). The shortfall was entirely attributable to final payments, which were below estimate by $80 million (-39.1 percent). It is unclear how much of this shortfall is a temporary timing issue related to a change in due dates effective for certain payments made beginning in calendar year 2017.
Gross receipts tax (GRT) fell short of estimate by $88 million (-7.5 percent), primarily due to lower than anticipated electric receipts. Recent data from the U.S. Energy Information Administration (EIA) indicate a decline in both electric utility prices and demand for calendar year 2017.
Personal income tax (PIT) collections came in as expected. Year-to-date quarterly payments remain strong and exceed estimate by $132 million (10.9 percent). Non-withholding PIT collections will likely be weaker than expected through June, due to the acceleration of payments into December and January as taxpayers attempted to maximize the benefits of federal tax law changes.
Non-tax revenues were below estimate by $53 million in March. Most of the shortfall was attributed to interactive gaming fees (-$20 million), casino auctions (-$8 million) and escheats (-$17 million). Although year-to-date escheats collections are also below estimate by $69 million (generally due to higher than anticipated claims), non-tax revenues exceed estimate by $320 million. This strength is related to higher than expected revenues from casino auctions ($90 million) and earlier than anticipated liquor profits transfers ($85 million).