State Tax Revenue Dips 1% in February

State Tax Revenue Dips 1% in February

The Arkansas Department of Finance and Administration on Thursday reported February net available general revenue of $402.1 million, down $4.6 million, or 1.1%, from a year ago.

The figure was above forecast by $55 million, or 16%.

“Revenue growth was above expectations again in February demonstrating continued economic growth in Arkansas,” Larry Walther, Secretary of the Arkansas Department of Finance and Administration, said in a statement. “Additionally, tax refunds are on track with the forecast as we enter the busiest months for filing.”

Gross general revenue for the month totaled $572.4 million, an increase of $44 million, or 8.3%, from last year. Gains were broad-based, with collections above forecast by $58.3 million, or 11.3%.

The department reported that all major collection categories were above forecast in February.

Sales tax collections in the month rose 13.1% to $258.1 million, topping the monthly forecast by $27 million, or 11.7%. Most major reporting sectors showed high growth year-over-year, reflecting continued economic expansion in many sectors. Motor vehicle sales tax collections rose 11.6% from February 2022.

Individual income tax collections came in at $262.7 million in February, down $2.1 million, or 0.8%, from a year ago. Still, collections in the category were 5.6% above forecast. The department said that individual withholding tax revenue decreased by 1.2% from a year ago due to income tax cuts.

Individual income tax refunds totaled $104 million, about $52 million higher than February 2022 and $2.6 million above forecast. Refund claims above forecast subtract from net revenue.

Corporate income tax collections added up to $21.1 million in February, an increase of $14.1 million. The figure was $15.6 million above forecast, which the department attributed to higher extension and return payments.

Corporate income tax refunds came to $43.5 million, up $4.8 million compared to February 2022.

Among smaller revenue sources, tobacco tax collections totaled $14 million, lower than a year ago and about $500,000 above forecast.

Gaming tax revenue came in at $5 million, higher than in February 2022 and above forecast by about $900,000.

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