Tennessee Tax Income Exceeds $ 1.5 Billion In Might | information

(The Center Square) – The state of Tennessee raised $ 1.6 billion in tax revenue in May, 38% more than budgeted estimate.

Through 10 months of fiscal year accrual, the state amassed 99% of the tax revenue it projected for the entire fiscal year, with $ 14.7 billion in accumulation and $ 14.9 billion in assessment, according to the nonprofit Sycamore Institute.

Excess tax dollars will remain in the state's general fund until Tennessee law provides it against an expense.

"Just as tax revenues showed significant growth in April, state tax revenues in May continued to reflect extraordinary increases over the same period last year when most economic activity was weakened due to the pandemic," said Butch Eley, commissioner for finance and Department of Tennessee in a statement. "If you compare the tax growth of May 2021 with May 2019, the monthly growth is 34.5% and not the growth of 59.8% compared to May 2020."

The Sycamore Institute analyzes sales tax receipts monthly after the state publishes its figures.

"In two months this over-collection is more than twice as high as the budget revisions by the legislature in April for the entire fiscal year," says the analysis by the Sycamore Institute. "That leaves a potential unplanned surplus of $ 1.4 billion and counting that policymakers could provide as one-off funding in future fiscal years."

Tennessee collected nearly $ 1.5 billion more in sales and use taxes than budgeted. The May numbers reflect this, with $ 258 million more than budgeted in the state.

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"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 decline," Eley said. “Corporate taxes, represented as concession and consumption taxes, recorded the second largest monthly growth since the beginning of the year. 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. "

Franchise and excise tax revenues were combined $ 85.9 million above budget for May and $ 851 million above budget for the fiscal year.

Gasoline and fuel revenues were $ 7.7 million higher than budgeted estimates for the month, tobacco tax revenues were $ 5 million higher, special taxes were $ 29.4 million, and business taxes were 8.1 Million dollars higher than estimates.

"Income projections are a big influence on spending decisions," said the Sycamore Institute. “An overestimation of revenues could force government policy to cut spending in the middle of the year.

“On the other hand, the underestimation of income creates unplanned surpluses that can be spent in the following year or saved in the Rainy Day Fund. The tradeoff of a surplus is that policymakers have chosen to either spend the money this year or cut taxes. "