Sales tax gains boost Arkansas tax revenue 4.4% in August report

Arkansas tax revenue in the first two months of the fiscal year (July-August) was $1.23 billion, up 3.5%, largely due to an increase of 8 .5% of sales and use tax revenue. Year-to-date tax receipts are also 3.3% higher than budget forecasts.

After ending the previous fiscal year in June with a surplus of $1.62 billion, the surplus after the first two months is $46 million, according to Friday’s (2 September) report from the Ministry of Finance and Arkansas Administration (DFA).

Personal income tax revenue in the first two months was $518.5 million, up 2.3% from the same period in 2021 and 1% above budget forecasts. Sales and use tax revenue in the first two months was $560.5 million, up 8.5% from the same period in 2021 and up 6.9 ​​% compared to forecast. Corporate income tax revenue was $42.1 million, down $9 million from the same period in 2021, and 0.5% lower than expected.

“Most of the major sales tax reporting sectors posted strong year-over-year growth, reflecting continued economic expansion in many sectors. Motor vehicle sales tax collections were up 8.0% year over year in August,” John Shelnutt, DFA Economics and Tax Research Administrator, noted in Friday’s report.

August revenue was $614.7 million, 4.4% higher than August 2021 and 3.6% higher than expected. Personal income tax revenue in August came in at $265.4 million, up 0.1% from August 2021 and 1.4% above forecast. August sales and use tax was $288.1 million, up 12.3% from August 2021 and 9.2% above forecast. Corporate income tax revenue in August was $7 million, down $4.2 million from August 2021 and $2.2 million below forecast.

Part of the sales tax gain is due to inflation. The July Consumer Price Index, released Aug. 10 by the U.S. Bureau of Labor Statistics, showed that all indexed items rose 8.5% in July compared to July 2021.

Total tax revenue in fiscal year 2022 (August 2021-June 2022) was $8.773 billion, up 8% – or $651.2 million – from a robust fiscal year 2021 in which the he tax surplus was $945.7 million.

OTHER SOURCES OF INCOME
the tobacco
July-August 2022: $35.9 million
July-August 2021: $38.7 million

Alcoholic beverages
July-August 2022: $13.2 million
July-August 2021: $13.7 million

Skill games
July-August 2022: $8.7 million
July-August 2021: $7.1 million

Insurance
July-August 2022: $21.2 million
July-August 2021: $20.9 million

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