/As anticipated, pandemic not major drag on state’s March revenue collections

As anticipated, pandemic not major drag on state’s March revenue collections

According to the Legislative Budget Committee’s recently released report, revenue collections for March were $26.3 million. This is 6.5 percent more than the March previous year. The current fiscal year’s first nine months have seen collections of $189.9million, which is 5 percent more than the collections in the same period last fiscal year. The fiscal year’s final quarter, April, May, and June, will be even worse. Lt. Gov. said that “everything is going to go significantly downward in the fourth quarter.” Recently, Delbert Hosemann stated. Although the economy has suffered a significant hit from record unemployment claims due to the coronavirus infection, state leaders didn’t expect a drop in revenue for March. House Speaker Philip Gunn (R-Clinton) stated recently that April would be a bad month and May was a good month. The reason March collections did not suffer from the pandemic, at least partially, is that the March sales tax reports actually reflect retail sales that occurred in February. The retail tax – which is 7 percent for most items – is collected by retailers and sent to the state the following month. 37% of state revenues come from sales tax. Sales tax collections in March were $159.4 millions, compared to $160.4million for March 2019. Individual income tax collections, another major source of state revenue, was down by more than $14million from $86.5 million in March 2019, compared with $72.3 million this March. Other revenue sources, like the income tax on corporations and the use tax for internet sales, were both significantly higher. The corporate tax collection rose by $36.1 million. Surprisingly, even though casinos were closed in March, $12 million of revenue was still collected by the state. This is almost $600,000. less than March 2019. Although state officials expect a decline in revenue over the last quarter of the current fiscal, they remain optimistic that they won’t have to cut budgets or dip into the rainy-day fund. Because state tax collections were high before the coronavirus struck, they are still strong. The year’s collections have increased by $217.7million, or 5.7 percent more than the official estimate during the 2019 legislative session that built the current budget. This $217 million is a substantial cushion that should keep the need to cut or use rainy day funds from becoming a reality. Hosemann stated that his goal was to complete the fiscal year without having to dip into the rainy-day fund. “I want to have that for the next year and hope we make significant improvements.”