Governor McAuliffe said, “The fourth quarter of the fiscal year is all important in terms of general fund revenue collections because of the May filing date for final and estimated payments for personal income tax receipts. Clearly, I am disappointed in the weak results for the first month of the quarter given the strong job growth in the Virginia economy. However, we still need to put all the individual estimated and final payments that were due May 2nd in the bank and see how payroll withholding performs in May with an extra deposit day before speculating on year end possibilities.”
April is a significant month for nonwithholding collections. Final payments for tax year 2015 and the first estimated payment for tax year 2016 are both due May 2. Typically, a portion of final payments due at the start of May for the previous calendar year are received in April; however, the amount varies from year to year. Since estimated and final payments continue to be processed in May, both April and May collections must be analyzed together to accurately assess growth in this source.
With one less deposit day compared with April of last year, collections of payroll withholding taxes fell 3.5 percent for the month. Collections of sales and use taxes, reflecting March sales, rose 4.2 percent in April. Also in April, corporations made their first estimated payment for tax year 2016, and made either a final or extension payment for tax year 2015. Collections of corporate income taxes were $133.5 million in April, compared with receipts of $145.5 million in April of last year, an 8.2 percent decrease.
On a year-to-date basis, collections of payroll withholding taxes – 63 percent of General Fund revenues — are 2.6 percent ahead of the same period last year, trailing the estimate of 4.1 percent growth. Sales tax collections – 18 percent of General Fund revenues – increased 1.9 percent, trailing the annual estimate of 4.1 percent growth. Since the filing season began on January 1, TAX has issued about 80,000 more refunds than the same period last year. The average refund size is up 1.0 percent. Year-to-date, refunds have risen 5.7 percent, ahead of the annual estimate of 1.2 percent growth. Year-to-date, nonwithholding collections are 0.4 percent ahead of the same period last year, trailing the annual estimate of 1.9 percent growth. On a fiscal year-to-date basis, total revenue collections rose 1.3 percent in April, trailing the annual forecast of 3.2 percent growth.
May and June are also significant collections months. Individual estimated and final payments will continue to be processed in May, and estimated payments for individuals, corporations and insurance companies are due June 15.
To view the full revenue report, click here.