State revenues dip in September
Gov. Bob McDonnell announced Thursday that total general fund revenue collections fell by 0.7 percent in September, primarily due to a decline in corporate income tax receipts and two fewer deposit days than in September 2011.
While net individual income tax collections rose by 2.7 percent and sales tax collections rose 3.6 percent, the September revenue losses were driven by a 17.7 percent fall in corporate income tax collections. This is due to a weakness in estimated payments from certain large corporations. September is a significant month for corporate income tax collections since the first estimated payment for the fiscal year is due.
On a year-to-date basis, total revenue collections rose 1.3 percent through September, trailing to the annual forecast of 2.9 percent growth. Adjusting for the accelerated sales tax program, total revenues grew 0.4 percent through September, trailing the adjusted forecast of 2.7 percent growth.
“September’s decline in revenue is a stark reminder of the tenuous recovery our nation and our Commonwealth is undergoing. While Virginia continues to fare better than most other states in this difficult economy, we must remain vigilant in our efforts to encourage business investment and job growth, and foster economic activity whenever possible. We must keep taxes low, streamline regulations, and put in place policies that help the private sector to help get our economy back on track,” McDonnell said.