August 2014 General Fund Revenue Collections Up 1.7% From The Previous Year And Fiscal-Year-To-Date Collections up 7.7%
~Individual Income Tax and Sales Tax Accounted for the Gain~
RICHMOND- Governor McAuliffe announced today that August General Fund revenue increased 1.7% from the previous year and cautioned that August is not a significant month for revenue collections.
On a fiscal-year-to-date basis, total revenue collections rose 7.7% compared with the same period last year, well ahead of the revised annual forecast of 2.7% growth. The main drivers of the revenue increase were the individual income tax and sales tax, while collections fell in recordation taxes.
“These numbers are an encouraging sign,” said Governor McAuliffe. “However, there is still much work to be done to offset the revenue shortfall in the current budget. We face challenges as a Commonwealth, but if we work together we can build a new Virginia economy that is stronger and less dependent on external forces.”
September collections will complete the first quarter of fiscal year 2015 and provide a clearer assessment of revenue growth. The first estimated quarterly payments from individuals, corporations and insurance companies are due in September.
Despite one less deposit day than August of last year, collections of payroll withholding taxes increased 1.7% in August. Collections of sales and use taxes, reflecting July sales, rose 4.5 % in August. Corporate income tax collections decreased 38.1% from last year. Finally, recordation taxes from real estate transactions were down 5.7% which is an improvement from the previous 10 consecutive months of double-digit declines.
On a year-to-date basis, collections of payroll withholding taxes – 64% of General Fund revenues -- increased 5.3%, ahead of the annual forecast of 2.7% growth. Sales tax collections – 19% of General Fund revenues – increased 5.3% through August, ahead of the annual forecast calling for a 2.8% increase. Adjusting for the accelerated sales tax program and the 0.125% sales tax transfer for transportation required by the provisions of HB 2313, total revenues are up 7.2% through August, ahead of the adjusted forecast of 2.9% growth.