Virginia posts record revenue increase in May
Gov. Ralph Northam today announced that total General Fund revenues rose 66.2 percent in May, the largest monthly revenue increase in more than 50 years.
Over 85 percent of the growth in May can be attributed to a return to normal tax filing dates for estimated payments and a shorter extension this year for individual final payments.
May is typically a significant month for revenue collections. In addition to regular collections of withholding and sales taxes, estimated and final payments for individuals are normally due May 1, however, last year the filing date was extended to June 1.
This year, the due date for final payments was moved to May 17 to align with the federal due date.
To accurately assess growth, data for the entire quarter of April through June will be needed.
“Virginia’s economy is roaring back to life thanks to hard work following the science and one of the strongest pandemic responses in the country,” Northam said. “New COVID-19 cases are at record lows, our vaccination rates are among the nation’s highest, and Virginians are heading back to work—and these record revenue gains are the result. Our responsible governance is paying off, and we will keep this up as we approach a new budget year and face major decisions about how to best use federal funding from the American Rescue Plan.”
On a fiscal year-to-date basis, total revenue collections advanced 17.8 percent, above the annual forecast of 2.7 percent growth. Collections in June must total $0.3 billion to attain the revenue forecast in Chapter 552, compared with June collections in the two years prior to the pandemic of about $2.4 billion. Collections of payroll withholding taxes grew 13.8 percent in May. Collections of sales and use taxes, reflecting April sales, grew 37.5 percent in May.
On a year-to-date basis, collections of payroll withholding taxes—62 percent of General Fund revenues—increased 4.4 percent, ahead of the annual forecast of 2.7 percent growth. Sales and use tax collections advanced 11.1 percent on a fiscal year-to-date basis, ahead of the annual forecast of 4.7 percent growth. On a fiscal year-to-date basis, total revenue collections grew 17.8 percent in May ahead of the annual forecast of 2.7 percent growth.
The full report is available here.