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State revenues holding up
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September state revenues came in at 5.6 percent, completing the first quarter of fiscal year 2012 and most observers are grading the quarter “pretty good.”

September individual income tax collections were only up 2.6 percent, but that may be a more accurate figure since refunds from a year ago were now even or about the same as a year ago.  Both individual tax return payments were up ($13 million, 98.7 percent) and estimated payments were up ($9 million, 7.3 percent). Net sales tax collections (the state portion) for the month were up $29 million or 7.1 percent. Motor fuel taxes combined were up 0.5 percent or $380,000, positive only because of the increase in sales taxes collected. These collections may accelerate downward if the price of fuel continues to fall and hits minus 25 percent which will trigger a decrease in the sales tax on fuel. Corporate taxes, again better gauged quarterly, were up 23.3 percent. Tobacco tax collections continued a positive trend, up 9.6 percent but alcohol beverages were down 14.8 percent.  

Year to date numbers for the first quarter

Despite the queasy feeling coming out of Washington these days and gloomy national indicators, Georgia, after one quarter, seems to be chugging along like the “Little Train That Could.” While there are concerns within the numbers, still the first quarter has to be genuinely encouraging.

An overall growth rate of 7.2 percent meets or exceeds our expectations for this fiscal year so far. I have been using a personal adjustment of $91 million off those returns due to the difference in July of tax refunds under a year ago. Even with that taken into account, the overall growth adjusted to 4.79 percent is still very good.

Individual income taxes for the quarter are up 11.5 percent or 6.8 percent taking into account the previously mentioned decrease in refunds in July.

For the quarter, individual tax refunds are down $98 million, individual withholding payments are up $82 million or 4.3 percent and estimated payments are up 11.4 percent. The proof of the difference in refunds lies, for me, in the sharp decrease in the number of refunds as well as in the amount, decreasing in the number of refunds by 100,000 claims and in dollars by $101 million.
YTD net to the state sales tax collections are up 3.0 percent or $38.4 million with total collections of $1.32 billion. A new, more timely pro-rata distribution to local governments will even out the collections numbers and may cause the net state number to rise slightly in some months compared to last year. YTD local distribution of sales tax collections is up 6.8 percen for the quarter.

Positive sales tax categories for the first quarter are accommodations, up 1.2 percent; automotive, up 3.9 percent; food, up 7.5 percent; home furnishing, up 2.1 percent; manufacturing, up 4.5 percent; and retail trade, up 8.4 percent. The only real negative category was construction at minus 4.5 percent.

Total motor fuel tax collections were up 4.4 percent or only $10.6 million for the first quarter.  Excise, by the gallon, collections were down 10.3 percent while sales taxes collections, riding higher prices, were up 18.6 percent.

The first quarter was not a good one for corporate tax collections, showing a negative 16.5 percent or -$19.2 million under the first quarter of last year. Tobacco taxes show a 24.4 percent increase but alcoholic beverages show a -16.7 percent decrease for the quarter.

So the state has taken in $4.05 billion dollars after one quarter and is producing a positive figure of $272.2 million to meet the budget the state is operating under.

“So far, so good.”

Next week: The world of bond sales and Georgia’s stellar position along with more facts on construction costs.

I may be reached at
234 State Capitol, Atlanta, GA 30334
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(404) 657-7094 (fax)
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