State revenues up 6.6 percent in August
Gov. Bob McDonnell announced Friday that total general fund revenue collections rose 6.6 percent in August. While August is not typically a significant month for revenue collections, mixed indicators continue to prompt caution and prudent fiscal leadership.
The August revenue gains were driven by strong individual withholding receipts which rose 4.3 percent and sales tax revenues which rose 12.3 percent as compared with August 2011. Other positive sources included corporate and recordation tax receipts.
On a year-to-date basis, total revenue collections rose 2.7 percent through August, close to the annual forecast of 2.9 percent growth. Adjusting for the accelerated sales tax program, total revenues grew 1.1 percent through August, trailing the adjusted forecast of 2.7 percent growth. However, net individual income tax fell 1.3 percent primarily as a result of timing issues with regards to withholding tax collections.
“Following our third-straight budget surplus, Virginia continues to demonstrate why it is among the best states in the nation in which to do business and live the American Dream,” said McDonnell. “While today’s economic indicators are mixed, illustrating our need to continue to make conservative, sound fiscal decisions, they do demonstrate that by keeping taxes low and putting in place policies that help the private sector, we can help get our economy back on track.
“While we should recognize our progress, the fact is, more than 250,000 Virginians are still out of work. That is simply unacceptable. This continues to be a very tough economy. We still confront much uncertainty on the federal level, especially in terms of the future of our national defense budget. In addition, we continue to contend with federal policies that are detrimental to private-sector job creation and, unfortunately, are making any recovery more difficult. We must continue to take every possible step to help the private sector grow and expand and innovate, and in the process create more good-paying jobs for our citizens. That is how we will get Virginians back to work.”