Governor McAuliffe Announces February Revenues
~Timing of income tax refunds results in 1.3 percent decline in general fund collections~
RICHMOND - Governor McAuliffe announced today that general fund revenue collections for February decreased 1.3 percent compared to February last year, primarily because of an increase in individual income tax refunds. On a fiscal year-to-date basis, total revenue collections rose 2.1 percent, behind the revised annual forecast of the 3.2 percent growth contained in the proposed budget (HB 29/SB 29) introduced in December 2015 to the 2016 General Assembly.
“February is not a significant month for revenue collections, but it is an active month for individual income tax refunds,” said Governor McAuliffe. “As a result, the timing of the refunds can significantly affect the bottom line for revenue collections, which may not be indicative of longer-term trends. Nonetheless, the results substantiate the fact that we need to keep up our work to grow the Virginia economy and continue to create more jobs. Building this new Virginia economy has been and remains my number one priority. Our two-year budget and capital bond package contain meaningful resources that will aid our work to strengthen Virginia’s economic infrastructure, increase Virginia’s presence in global markets and create jobs. I remain confident that we are moving the Commonwealth in the right direction, and we will not be content until we reach our goal.”
The collection data shows that payroll withholding taxes rose 0.5 percent in February, with one more deposit day than February of last year. Collections of sales and use taxes reflecting January sales rose 0.7 percent in February. The Department of Taxation issued $396.0 million in individual income tax refunds in February compared with $374.0 million last year, a 5.9 percent increase, as the individual income tax filing season entered into full swing.
On a year-to-date basis, collections of payroll withholding taxes – 63 percent of General Fund revenues -- increased 2.4 percent, behind the annual forecast of 4.1 percent growth. Sales tax collections - 19 percent of General Fund revenues – increased 0.8 percent through February, behind the annual forecast calling for a 4.1 percent increase. Adjusting for the accelerated sales tax program, total revenues rose 2.6 percent through February, behind the adjusted forecast of 3.3 percent growth.
To view the full revenue report, click here.