Nashville, Tennessee – Tennessee Treasury and Administration Commissioner Butch Eley announced today that revenue for May was $ 1.6 billion, $ 432 million more than budgeted monthly sales estimate. The state's tax revenue was $ 587.3 million more than in May 2020, and the overall growth rate was 59.8 percent.
"Just as tax revenues showed significant growth in April, state tax revenues in May continued to reflect exceptional increases over the same period last year when most economic activity was weakened due to the pandemic," Eley said. “If you compare the tax growth of May 2021 with that of May 2019, the monthly growth is 34.5 percent and not the growth of 59.8 percent compared to May 2020.
“May sales tax revenue, which reflects taxable sales activity in April, grew in all industries except grocery stores and grocery stores, which saw a small decrease. Corporate income taxes, represented as concession and consumption taxes, have shown the second largest monthly growth in the year to date. It is also noteworthy that income taxes, which are normally due in April, are included in that month's earnings due to an extension of the filing deadline. While the sales balance has continued to improve since the beginning of the year, we will continue to adhere to the conservative housekeeping until the end of the financial year. We must continue to recognize the role federal funds and inflation play in this already volatile economy. "
May is the tenth month in the 2020-2021 financial year.
The general fund income was $ 392.8 million above budgeted estimates and the four other funds that contribute to state tax revenues were $ 39.2 million above estimates.
Sales tax revenue was $ 258 million above estimates for May and 51.21 percent higher than in May 2020. For ten months, revenue is $ 1,483.8 million above estimates. The growth rate since the beginning of the year is 14.08 percent. In April, the Distance Selling and Marketing Facilitation Acts contributed $ 54.9 million to sales tax revenue. For nine months, online sales tax revenue accounts for 36.55 percent of total sales tax growth for the state.
Combined franchise and excise tax revenue was $ 85.9 million above the budgeted estimate in May, and the growth rate compared to May 2020 was 127.76 percent. For ten months, sales are $ 851 million above estimate and year-to-date growth is 49.87 percent.
Gasoline and fuel revenues rose 55.37 percent in May compared to May 2020, and were $ 7.7 million above the budgeted estimate of $ 100.7 million. For ten months, earnings are $ 11.1 million below estimates.
Hall's income tax revenue for May was $ 36 million above budgeted estimate as the filing deadline for that tax was extended to that month. For ten months, earnings are $ 22.5 million below budgeted estimate.
Tobacco tax revenue was $ 5 million higher than May's estimated $ 19 million. For ten months, they're $ 14.6 million more than the budgeted estimate.
Privilege tax revenue was $ 29.4 million higher than the May estimate and, on an annualized August-May basis, income was $ 101.8 million higher than the estimate.
Business tax revenue was $ 8.1 million above the May estimate. For ten months, earnings are $ 43.2 million above budgeted estimate.
Vehicle registration revenue was $ 1.9 million above the May estimate and annualized revenue is $ 15.5 million above estimate.
Mixed drinks or liquor-by-the-drink taxes were $ 0.8 million above the May estimate. For ten months, earnings are $ 23.9 million below budgeted estimate.
All other tax revenues were $ 0.8 million net below estimates.
Annual revenue for ten months was $ 2,444.6 million above budgeted estimate. The general fund was $ 2,339.2 million more than budgeted estimate and the other four funds were $ 105.4 million more than budgeted.
The budgeted revenue estimates for 2020-2021 are based on the consensus recommendation of the state funding committee of November 26, 2019 and were approved by the second meeting of the 111th General Assembly in June 2020. The estimates also include any changes in revenue that occurred during the 2020 General Assembly session. These estimates are available on the state's website at www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget- rev.html available.
On November 18, 2020, the State Promotion Council met again to listen to updated revenue forecasts from various state economists. Following this meeting on November 24, 2020, the Management Board decided to adopt revised sales growth margins for the current financial year. The assumed recurring growth ranges include a low of 1.00 percent to a high of 1.20 percent for total taxes and a recurring low of 1.50 percent to a high of 1.75 percent for general fund taxes.
On April 29, 2021, at the first meeting of the 112th General Assembly, the legislature passed the budget for 2021-2022, which includes the revised income areas of the funding committee for the current year. Once passed, an additional $ 1,034.1 million in total funding and $ 1,068.9 million in general fund revenue were added to this year's original budget estimates. Public Chapter 454, known as the Budget Act, was signed by Governor Lee on May 17, 2021.