Governor McAuliffe announced today that September General Fund revenue decreased 2.4 percent from the previous year, largely due to the timing of payroll withholding taxes.
Payroll withholding fell 5.8 percent in September, following a 17.7 percent jump last month. The Governor also stated that September completes the first quarter of fiscal year 2017 and is a significant month for revenue collections. Estimated payments from individuals, corporations, and insurance companies are all due in September, along with regular monthly collections in withholding, sales taxes, and other sources.
On a fiscal year-to-date basis, total revenue collections rose 3.6 percent, well ahead of the annual forecast of a 1.7 percent increase. The main drivers of the revenue increase were the individual income tax and recordation taxes.
“I am pleased that our revenue collections during the first quarter of the fiscal year are tracking well ahead of the annual budget forecast, but we are obviously remaining cautious as we continue through the year,” said Governor McAuliffe. “I am hopeful that our conservative budgeting approach and continued focus on creating jobs and new economic activity will continue to improve the Commonwealth’s revenue picture and the opportunities we offer families in every corner of Virginia.”
September is a significant month for collections in nonwithholding, since the first estimated payment for fiscal year 2017 is due. Collections fell 3.1 percent in September from last year. Collections of sales and use taxes, reflecting August sales, fell 3.5 percent in September. As with nonwithholding, September is a significant month in corporate income tax collections, since the first estimated payment for the fiscal year is due in September. Collections of corporate income tax increased 10.0 percent in September from September of last year. Finally, collections of wills, suits, deeds, and contracts – mainly recordation tax collections – were $35.1 million in September, compared with $29.5 million in September of last year.
On a year-to-date basis, collections of payroll withholding taxes – 64 percent of General Fund revenues — increased 4.1 percent, ahead of the annual forecast of 3.0 percent growth. Year-to-date nonwithholding collections were $470.8 million, compared with $472.0 million in the same period last year, falling by 0.2 percent and ahead of the annual estimate of a 1.2 percent decline. Sales tax collections – 18 percent of General Fund revenues – increased 0.2 percent through September, behind the annual forecast calling for a 2.6 percent increase. Through the first quarter of the fiscal year, corporate income tax collections have increased 5.1 percent from the same period last year, ahead of the annual estimate of a 3.0 percent decline.
To view the full revenue report, click here.
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