Tennessee tax revenue exceeded budgeted estimates for the month of June, according to Department of Finance and Administration Commissioner Stuart McWhorter.
Overall, June revenues totaled $1.6 billion, which is $115.3 million more than the state collected in June of 2018, and $92.5 million more than the budgeted estimate for the month.
“Total revenues in June were notably higher than expected and continue to confirm the strength of the Tennessee economy,” Commissioner McWhorter said. “Eighty percent of the tax growth for this month compared to June 2018 was from combined sales tax and franchise and excise tax receipts. All other tax revenues, taken as a group, were also more than the June estimates.
“With one revenue reporting month remaining in the 2018-2019 fiscal year, the state should outperform the revenue estimates set for the year.”
On an accrual basis, June is the 11th month in the 2018-2019 fiscal year.
General fund revenues were more than the budgeted estimates in the amount of $85.5 million, while the four other funds that share in state tax revenues were $7 million more than the estimates.
Sales tax revenues were $35.1 million more than the estimate for June and they were 6.37% more than June 2018. June sales tax revenues reflect retail business activity that occurred in May. For 11 months, revenues are $291.7 million higher than estimated. The year-to-date growth rate for eleven months was 5.79%.
Franchise and excise tax revenues combined were $46.3 million higher than the June budget estimate, and the growth rate was 10.39%. For 11 months, revenues are $229.7 million more than the estimate and the year-to-date growth rate is 7.28%.
Gasoline and motor fuel revenues for June increased by 4.14% compared to June 2018, and they were at the budgeted estimate of $103.3 million. For 11 months, revenues have exceeded estimates by $4.8 million.
Motor vehicle registration revenues $3.6 million more than the June estimate, and on a year-to-date basis, revenues are $26.8 million more than the estimate.
Tobacco tax revenues were $1.7 million more than the June budgeted estimate of $22.2 million. For 11 months, they are $4.5 million less than the budgeted estimate.
Hall income tax revenues for June were $0.1 million less than the budgeted estimate. For 11 months, revenues are $43.7 million more than the budgeted estimate.
Privilege tax revenues were $5 million more than the June estimate, and on a year-to-date basis, August through June, revenues are $11 million more than the estimate.
Business tax revenues were $2.1 million less than the June estimate. For 11 months, revenues are $23 million more than the budgeted estimate.
All other tax revenues exceeded estimates by a net of $3 million.
Year-to-date revenues for eleven months were $649.2 million more than the budgeted estimate. The general fund recorded $589.7 million more than budgeted estimates, and the four other funds $59.5 million.
The budgeted revenue estimates for 2018-2019 are based on the State Funding Board’s consensus recommendation of November 27, 2017 and adopted by the second session of the 110th General Assembly in May 2018.
Also incorporated in the estimates are any changes in revenue enacted during the 2018 session of the General Assembly. These estimates are available on the state’s website at https://www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget-rev.html.
On November 20, 2018, the Funding Board met to hear updated revenue projections from the state’s various economists. On November 26, 2018, the board adopted revised recurring revenue growth ranges for the 2018-2019 fiscal year. The current fiscal year’s revised ranges recognize recurring growth in total taxes from a low of 2.35% to a high of 3.25%, and a general fund growth from a low of 2.2% to a high of 3.2%.
On April 30, 2019, in the first session of the 111th General Assembly, the legislature passed the 2019-2020 budget, which included the Funding Board’s current year revised ranges and also the administration’s amendment to the proposed budget. The governor signed the budget bill on May 17, 2019.
With the passage of the appropriations act, Public Chapter 405, the General Assembly recognized in the current fiscal year an additional $161 million in total revenue and a corresponding increase in general fund revenue in the amount of $119.1 million.